German energy giant Innogy has made its first move into Australia’s burgeoning utility-scale solar market, buying two undeveloped projects totalling more than 460MW, and signalling further investments in wind and battery storage.
Innogy’s purchase of the two NSW projects – Limondale and Hillston – from local developer Overland Sun Farming signals that the Australia solar boom is far from over.
Innogy intends to start building the two projects in 2018, at a total cost of around $620 million, and is on the lookout for more solar, wind and storage opportunities.
“With the acquisition of two of Overland’s Australian solar development projects, innogy is entering into a strongly growing renewable energy market,” CEO Uwe Tigges said in a statement.
“This is a perfect fit with our strategy to deliver sustainable bottom line growth in accordance with innogy’s financial targets to maximise value for the company and our shareholders. Execution of the two photovoltaic power plant projects is in line with Innogy’s hurdle rate framework and funding capacity.”
Innogy is not just any old energy firm. It is 75 per cent owned by Germany’s RWE, one of Europe’s biggest energy utilities, and boasts annual revenues of more than $A70 billion.
The company’s “old assets” such a coal and nuclear generation were left behind in RWE, while Innogy holds the so-called “future” energy businesses – renewables, network and retail businesses – that will focus on a “modern, decarbonised, decentralised and digital energy world.”
The Australian acquisition follows Innogy’s deal in December to buy more than 2GW of onshore wind power projects in the United States, its first move into the world’s second biggest wind market.
Innogy will set up an Australian-based team, most likely in Melbourne, to pursue solar, wind and battery storage projects. It recently bought the German-based solar and battery storage specialist Belectric, which has built one small solar farm in Australia but whose technology is also used.
“Australia is the continent with the highest solar irradiation per square meter. Australia is an excellent starting point for innogy to grow a valuable solar business,” said COO Hans Bünting,