China

China

Return to homemarket in Australia -- Roaring 40s Asia withdrawal

Roaring 40s, a 50-50 joint venture between Australia's Hydro Tasmania and Hong Kong's CLP Group, is pulling out of the wind markets in China and India. In a decision driven by its Australian partner, CLP is buying Roaring 40s' share of wind projects in the two countries, leaving the joint venture with Australian assets only.

Roaring 40s' return to its home market is a complete reversal of recent strategy. Its focus has been on reinvesting the profits from its Australian wind farms in new projects in China and India. In China, Roaring 40s, led by Mark Kelleher, has been regarded as the leading foreign developer in the market (Windpower Monthly, December 2007). Its success has stemmed from its strong relationship with two of China's biggest state companies, Datang and Guohua -- these each hold the majority 51% share of their respective Roaring 40s joint venture projects.

Roaring 40s declines to comment on the decision. Hydro Tasmania's David Crean says: "The time is right to focus the expertise built overseas back in the Australian market." He points out that the joint venture was established because of the lack of support of Australia's previous federal government for the home market and its unwillingness to extending the Mandatory Renewable Energy Target (MRET). "The prospects for renewable energy in Australia have change for the better," says Crean, although since the decision to pull Roaring 40s back home, MRET is again on shaky ground (page 40).

Hydro Tasmania will pocket A$66 million (EUR 36 million) for its share of Roaring 40s' China business, with CLP taking full ownership of the 49% share Roaring 40s held in around 500 MW of projects. Hydro Tasmania expects a further A$15.5 million (EUR 8.5 million) from the sale of the 50.4 MW Khandke wind project in Maharashtra, India. The combined sales, says Hydro Tasmania, will see Roaring 40s receiving A$163 million (EUR 88.8 million) for investment in renewables projects in Australia, with its 130 MW Musselroe Wind Farm in Tasmania one of the priority projects.

Roaring 40s Australian portfolio includes full ownership of two operational wind farms at Woolnorth in Tasmania totalling 140 MW, a 50% share in the 66 MW Cathedral Rocks Wind Farm in South Australia, and further development projects across a number of states, including Musselroe.

For CLP, the deal takes its renewables capacity to over 1200 MW, accounting for 9% of its total generation capacity. The company says its position as a leading developer in mainland China has now been strengthened. It intends for the "non-carbon emitting generating capacity" of its portfolio to reach 20% by 2020, says CLP's Andrew Brandler.

CLP's interest in Roaring 40s in Australia will be managed through its subsidiary, TRUenergy. "Roaring 40s continues to complement TRUenergy's renewable energy portfolio in Australia, which also includes early stage solar and geothermal development projects," says Brandler.

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