Strategic deal to back big portfolio -- Lots of South Australia activity

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Babcock & Brown has acquired all of the wind data, wind monitoring towers and land rights in South Australia previously owned by Pacific Power International (PPI). The acquisition was part of an agreement which will see PPI become the engineer for all Babcock & Brown's South Australia wind developments.

Babcock & Brown now has six major wind energy projects under development in South Australia including the advanced 41 turbine Lake Bonney Stage 1 project for which a decision on the turnkey supplier was expected late last month. Babcock & Brown is evaluating the three final tenders received from AN Bonus, Vestas and Enron/Siemens consortium for the $100 million project.

Other projects include Lake Bonney Stage 2 and Mt Benson, both of which were acquired from PPI, Lake George and two development sites on the Eyre Peninsula. Babcock and Brown will continue to own this portfolio of wind energy projects in partnership with National Power.

PPI is responsible for the development of the Crookwell and Blayney wind farms in New South Wales and specialises in providing engineering, technical, environmental and utility management services to the power industry in Australia and internationally.

Major boost

Speaking for Babcock & Brown, Miles George says the agreement with PPI provides a major boost for the company's wind farm projects in South Australia. "Pacific Power's expertise and experience gained from developing two successful Australian wind farms provides a strong match with Babcock & Brown's focus on investment in the wind energy industry in South Australia," he adds.

"In addition, PPI brings to the table two extensive wind data sets from the German Hill and Mount Benson meteorological towers which have been operating for two years. This data combined with Babcock & Brown's large wind data set from its Lake Bonney meteorological towers provides the most comprehensive analysis of wind energy potential ever available for the south east of the state."

The stimulation of the South Australian wind energy industry is due mainly to the demand for renewable energy created by the Australian government's Renewable Energy (Electricity) Act 2000 which incorporates the Mandatory Renewable Energy Target (MRET). Renewable energy certificates created from these projects will be sold to energy retailers and large buyers of electricity to enable them to meet their MRET obligations.

To a lesser degree summer peak energy supply shortfalls predicted for South Australia and Victoria in the coming four years is also driving the wind industry expansion in the state.

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