Irish wind power developer Airtricity is to be sold to Scottish and Southern Energy plc (SSE) under a deal that will reinforce the utility’s position as the UK’s leading renewable energy generator.
The Euros 1.8 billion purchase price includes an equity value of Euros 1.1 billion and liabilities of Euros 375 million. It will also include the Euros 0.8 billion proceeds of the recent sale of Airtricity’s North American business.
The acquisition will increase SSE’s portfolio of operating wind energy from 170 MW to almost 480 MW, making it the largest wind farm operator in the UK and Ireland. It increases its total operating portfolio of renewable energy – which includes hydropower and biomass capacity – to just over 1900 MW.
Airtricity also has a number of onshore and offshore wind project that are either under construction or have full consent, and on this basis, SSE expects to have over 3500 MW of operating renewable energy capacity, including hydro, pumped storage and biomass, by 2013.
SSE intends to use Airtricity as a platform to further develop its renewable energy business in line with a corporate policy set out last year. It says that seven major public policy developments in the EU and the UK in 2007 point towards a “material step-change” in renewable energy development, and will require the EU to put in place a framework to ensure that around 35 per cent of electricity is generated from renewable sources by 2020.
“The range of investment opportunities now available to SSE in renewables will become increasingly important as the world becomes more carbon constrained and the EU becomes more concerned about energy security,” said Ian Marchant, chief executive of SSE. “Demand for renewable energy is only going to go up.
“In one step this acquisition moves SSE forward in onshore wind, offshore wind, in Ireland, Europe and China and gives added momentum to the increasing scale and broadening scope of SSE’s activities which has been achieved over the past few years.”
Airtricity’s principal assets include 14 wind farms in operation throughout Republic of Ireland, Northern Ireland and Scotland with a total installed capacity of almost 400 MW. A further nine wind farms totaling almost 200 MW are under construction and the company has a global pipeline of 10 000 MW.
The acquisition will also allow SSE to advance its position in the new single electricity market in Ireland and extend its renewable energy interests in continental Europe. Crucially, it will also increase SSE’s interests in China, which is likely to play a greater role in carbon trading in the future.
Airtricity has a 1434 MW portfolio of other onshore wind energy projects in the UK and Ireland that are in various stages of development but not yet with full consent and 1222 MW of early-stage European wind energy development projects in Portugal (587 MW) and the Netherlands (635 MW offshore). It also has a 6675 MW portfolio of wind energy development projects in China.
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