EnerTAD did not disclose the price of the deal, which was the second major order with an Italian company announced by Repower last month. Utility Enel is also buying Repower turbines (page 41). EnerTAD chief executive Raffaele Tognacca says the value of the Repower agreement is "in line with industry values" and with the company's announced capital expenditure of EUR 1.7-1.8 million per megawatt of wind capacity installed. That has risen from EUR 1.5 million/MW in the previous business plan, mainly as the result of higher turbine prices.
New renewables division
Aside from the 55.2 MW in France, the Erg group has 116 MW up and running in its home country. Erg will shortly spin off its renewables activities into EnerTAD, which will be renamed Erg Renew, in a transaction that will see Erg's stake in its renewable division rise to 77.4% from a current 68.4%. At the end of 2011, Erg Renew is slated to own 584 MW in Italy and 115 MW in France. Tognacca says the group is also eyeing opportunities in other countries with wind markets in expansion and solid regulatory frameworks.
The company believes its forecasted 584 MW of wind power in Italy by 2011 will represent a 10-12% market share that year. Prior to a decision to dissolve Erg Cesa Eolica, a 50:50 joint venture with Spain's Acciona Eolica CESA, and to split up its assets, the Erg group had been targeting as much as 20% of the Italian wind business in 2010.
Among projects furthest ahead in its pipeline, the company expects to have a 24 MW wind farm in Faeto in the southern Italian region of Apulia operating later this year. Construction has also begun on its largest project, the Fossa del Lupo plant in Calabria, which is now expected to be 100 MW rather than the 110 MW initially announced. It should be up and running in 2010 or 2011. To help finance its 2008-2011 business plan, a capital increase of up to EUR 200 million is slated for later this year.
EnerTAD says its net profit in the first quarter of 2008 fell 44.2% to EUR 1.5 million on the year as a result of increased financial and amortisation expenses related to recent wind plant acquisitions in France. Earnings before interest taxes depreciation and amortisation (EBITDA) rose 6% to EUR 8.1 million and revenues increased 17.8% to EUR 13.6 million, demonstrating that a decline in domestic wind operations as a result of poor winds in the first part of the year was more than compensated for by the French acquisitions.