German utility gets serious -- Going global

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German energy giant E.ON's fledgling E.ON Climate & Renewables unit is expecting to add about 4 GW of new wind power by 2010, mainly in North America, Spain, Portugal and the UK, to bring its total portfolio of operating wind capacity to around 5 GW. It currently operates about 900 MW (table).

The renewables unit was launched at the start of the year to manage and expand E.ON's global renewables business and co-ordinate climate protection activities. It currently operates 1010 MW of renewables capacity, of which 760 MW is in Europe and 210 MW in North America. A further 336.5 MW was expected on line in the US by the end of last month.

"In just a short time we've become one of the world's top ten wind farm operators," says the company, which describes itself as the world's largest investor-owned energy service provider. Its recent progress in wind power is mainly due to acquisitions, including about 220 MW of wind capacity in Germany and 205 MW in the UK. In August it got its foot into the Iberian Peninsula by buying Energi E2 Renovables Ibericas from Denmark's Dong Energy, adding about 260 MW of wind assets in Spain and Portugal to its portfolio for about EUR 481 million and most recently it bought Airtricity's US and Canadian wind power development business.

As a result, "a more expansive development project pipeline is in place for the coming years," says E.ON. In Spain and Portugal it will add a further 50 MW this year, followed by 250 MW in 2009 and 180 MW in 2010, says the company.

The purchase last year of Airtricity marks the biggest bump in E.ON's wind assets. For roughly EUR 580 million, it picked up 210 MW of operating wind projects in Texas and New York states, a further 335 MW in various stages of construction, and as much as 5000 MW of potential future projects in early stage development.

Since then Airtricity has brought online the 34.5 MW Munnsville project in New York, with the 206 MW Roscoe 1 and the 126 MW Champion wind farms in Texas due to follow suit in the first quarter of the year, bringing North American operational wind assets to 576.5 MW. A third Texas project, the 90 MW Sand Bluff plant, is under construction and a Pennsylvania project is approaching construction.

E.ON says its total US operational projects could reach 1000 MW by the end of 2008. Beyond this year, further development is expected in both Canada and the US with 750 MW added in each country each year through 2009 and 2010. E.ON last month committed to an order totalling 180 MW for 109 Vestas 1.65 MW turbines, destined for mid-2009 commissioning.

On land and at sea

In the UK, where E.ON Climate & Renewables operates 21 wind stations onshore and offshore, totalling 212 MW, 205 MW of which it owns, the company plans to grow its business "in response to UK regulatory initiatives." Potential onshore and offshore projects with a combined capacity of about 1134 MW are in development -- almost identical to the figure it presented at the end of 2006.

This includes the huge 1000 MW London Array offshore project east of London, in which E.ON is one of the owning partners together with Shell WindEnergy and Dong Energy London Array, a joint venture between Denmark's Dong and small UK company Farm Energy. Meantime, construction has already begun on E.ON's Robin Rigg offshore station in the Solway Firth off the English northwest coast using 60, 3 MW turbines and completion is expected in the second quarter of 2009.

In Germany, E.ON Climate & Renewables' plans are focused on involvement in four offshore projects in the North Sea and Baltic Sea -- three at 400 MW each and a fourth at 150 MW. For the most part these will not come online until after 2010, says the company. The exception is the Alpha Ventus 60 MW test station shared with regional utility EWE and Swedish state-owned energy company Vattenfall Europe, which is scheduled to enter service later this year.

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