Renewable energy developer Tilt Renewables expects that Covid-19 will only have limited impacts on its ongoing operations, but has told investors that it expects a small dip in anticipated earnings, primarily due to ongoing network challenges.
In an earnings update released to the ASX, Tilt says that the expected dent to its earnings is primarily due transmission outages in Victoria during February, which limited output from its Snowtown 1 wind farm, and delays to the commencement of generation at the Dundonnell wind farm in Victoria.
Tilt still expects to deliver strong growth in its earnings for the 2020 financial year, and says that it has been able to cope with the interruptions caused by Covid-19 as its small workforce has been able to commence remote work.
“Tilt has worked with our operations and maintenance partners to take proactive measures to protect the health of all site employees, including segregation of workgroups, back-up coverage for certain key skill sets, remote working for support staff and reinforcing general hygiene practises,” the statement to the ASX says.
While the company acknowledged the challenges being presented by new measures necessitated by the Covid-19 outbreak, Tilt says it does not expect any significant interruption to its business operations or anticipated revenues for the remainder of the year.
The company, which operates across both Australia and New Zealand said that travel restrictions will prevent the movement of key personnel between the two countries, but it is able to adapt through alternative arrangements for the completion of the Dundonnell and Waipipi wind farms in each country.
“Alternative local resources with sufficient expertise have been identified where required, and again at this time is not expected to impact either project materially.”
As reported by RenewEconomy, construction commenced at the Dundonnell wind farm in January last year, with the delivery of wind turbine components having initially been delayed by factory shut downs in China, but all parts have now been shipped and are on their way to the site.
The 336MW Dundonnell wind farm was awarded a contract under a Victorian government tender, as part of the state’s target of reaching 50 per cent renewable electricity by 2030. 28 of the wind farm’s 80 planned turbines have already been erected, with first generation occurring earlier in the month.
Construction works continue at the site in Victoria, with the company monitoring government advice on health measures, but expects the “essential service” nature of the work will see the wind farm construction completed.
However, construction works at the Waipipi wind farm in New Zealand have been delayed, by at least four weeks, after the New Zealand government deemed the work as non-essential. Tilt believes it has sufficient contingency within the project’s timeline to deal with the delays, and will take further measures as needed if the construction shut down is extended beyond the initial four weeks.
Tilt notes that electricity supplies were a “lifeline utility” or “essential service” and while it had implemented measures to protect staff and operations from the spread of Covid0-19, “to date [Tilt] has not experienced any impact attributable to the Covid-19 pandemic on the operational asset fleet, generation volume, costs or revenue.”
Tilt Renewables issued an updated earning guidance, saying that it expected profits to be up to $1 million below the lower end of its profit guidance range of $118m to $122m for the current financial year.
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