Over Greencoat Renewables’s (GRP) full-year results period to year-ended 31 December 2019, the Ireland-focused renewable energy infrastructure company grew considerably with two successful equity placings taking its market capitalisation from €391.4m to €747.3m.
Portfolio-wise, GRP said its stable of 15 wind farms generated 1,154GWh in the year, 4% below budget, primarily due to higher than expected curtailment. Otherwise, there were no material unplanned outages or issues affecting any of the assets in the period, with the portfolio generating net operating cash flow of €48.8m, providing dividend cover of 1.7x.
GRP wants to expand to the Nordic countries
A special resolution will be proposed at the company’s forthcoming AGM to amend the investment policy to enable it to invest in Denmark, Norway and Sweden.
In addition to Finland, GRP says the additional Nordic countries of Denmark, Norway and Sweden would provide the group with the benefit of a larger pool of potential acquisition targets and allow for diversification.
Ireland commits to generate 70% of electricity from renewables by 2030
GRP’s chairman, Rónán Murphy, provided the following outlook statement: “The Irish wind market remains an attractive jurisdiction with both a stable and supportive regulatory regime and broad public support. The country has over 4.0GW of installed capacity either in operation or construction under REFIT 1 and REFIT 2, and the board continue to view Ireland as an attractive market for further investment.
In June 2019, the Irish Government announced its climate action policy committing the country to generating 70 per cent of electricity from renewables by 2030 and is projected to create more than €12b of further investment opportunities. It is expected that the majority of this new capacity will be delivered under the new RESS, a competitive auction structure for CFD support, with such auctions expected to commence in 2020 and run until 2026. Given the expected CFD structure of RESS, as well as regular auctions planned until 2026, this should ensure Ireland remains a very attractive jurisdiction for further investment. In addition, Ireland is experiencing substantial growth in the demand for electricity, particularly from the development of a substantial number of data centres. We expect to see a growing number of large corporate entities seeking to enter into long term electricity contracts.
The group is now able to make acquisitions in Belgium, Finland, France, Germany and the Netherlands, in line with our existing investment policy. Continental Europe can provide further diversification of intra-year generation volumes and gives the Group access to a considerably larger pool of assets from which to seek best value. In addition to the above jurisdictions, the Group is assessing opportunities in the Nordic regions, currently outside of the investment policy. Special resolution 9 will be proposed at the forthcoming AGM to amend the investment policy to enable the Group to invest in Nordic countries in addition to the other relevant countries.”
GRP: Greencoat Renewables looks to add Nordic markets to its mandate