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Ireland's Airtricity has bold plans for wind energy |
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Written by jonathan pitzer
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Tuesday, 27 May 2008 |
Irish wind farm operator Airtricity is looking to raise at least 310 million euros ($402.2 million) in 2007,
matching the amount of equity raised this year, as it pursues aggressive U.S. and European expansion plans.
Privately owned Airtricity, which began life less than a decade ago with an initial investment of around 635,000 euros, now has a net worth of more than 1 billion euros ($1.3 billion), according to CEO Eddie O'Connor, one of the founding partners.
"In 2006 we raised 310 million euros," O'Connor told Reuters on Thursday. "We're going to raise at least that next year."
Irish energy and waste management company NTR Plc invested 127.5 million euros in Airtricity this year to maintain the 51 percent stake it took in 1999 while UK investment and advisory firm Ecofin paid 122.5 million euros for a 16 percent holding.
"By the time we're finished and done with we're going to have millions of owners," O'Connor said.
The former head of Irish peat supplier Bord na Mona is a man with big ambitions.
He is currently pushing the concept of a European "supergrid" -- an offshore network of wind farms in the seas of northern, western and southern Europe to provide electricity for a continent increasingly reliant on imported fossil fuels for its energy supplies and desperately seeking new energy sources.
Airtricity is expected to announce acquisitions in the Netherlands and Germany over the next week. IPO ON THE HORIZON
O'Connor sees a flotation as inevitable given the company's growth plans and the capital-intensive nature of the business.
"We could float now ... but it's not up to me. I don't own 51 percent of the company," he said.
"Certainly that has to be on the horizon because (of) the amounts of money that are going to be needed."
Airtricity expects to bring more than 2,000 megawatts (MW) of wind energy onstream over the next three years.
In June the company said it would spend over $550 million on more than 300 General Electric Co. <GE.N> turbines to deliver 500 MW of renewable energy for its 2008 programme.
Intense supply pressure means that companies like Airtricity are having to book orders well in advance of requirements.
"My opinion is we'll be buying 100 more megawatts from Mitsubishi for 2008. We're seeking board approval for that," he said. "That gets us to about 600 megawatts in America in 2008."
U.S. President George W. Bush said earlier this year the United States should reduce its reliance on foreign oil by developing alternative energy sources and has said 20 percent of its electricity should come from wind energy.
While the United States still has sizeable amounts of land left to put wind turbines onshore, O'Connor said countries in Europe were increasingly looking offshore for wind energy.
This has spurred his vision of the European supergrid.
He is proposing a 10GW demonstration project -- enough power for over 8 million homes -- to prove the concept. The project would be located offshore between the UK, the Netherlands and Germany with 2,000 turbines covering 3,000 square kilometres.
O'Connor has already talked to British Prime Minister Tony Blair about the project and said Blair had discussed it with German Chancellor Angela Merkel.
With a capital cost of 2 million euros per megawatt and grid cost of 2 billion euros, Airtricity will need buy-in from governments before it can start courting partners and finance but believes it can be built in the next five years.
"It's not as if Europe has big choices," O'Connor said. |
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Last Updated ( Monday, 01 September 2008 )
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