Two Scandinavian wind-power developers will merge their 3.2 billion-euro ($3.5 billion) investment pipeline of developments across Finland, Norway and Sweden to cut costs.
Closely held Havgul Clean Energy AS of Norway and Triventus Wind Power AB of Sweden will combine to form a company with 1.6 gigawatts of project plans, they said in an e-mailed statement.
Havgul Nordic AS, as the business will be called, plans 15 projects, with seven totaling 504 megawatts in Sweden, five with 865 megawatts in Norway and three in Finland. The projects range from small sites that don’t yet have authorities’ approval to large ones with consent including an offshore wind farm.
“We’re aiming to establish one of the lowest cost and highest return wind developers in the Nordic region,” Chief Executive Officer Harald Dirdal said. “The Norwegian and Swedish governments have recently increased their renewable energy targets and we expect to be well positioned to exploit this highly positive regulatory driver in the years ahead.”
Norway and Sweden since 2012 have operated a joint system that issues tradable certificates to power companies for each megawatt-hour of renewable energy they produce. Suppliers and consumers must buy certificates to match power they provide or use. On March 13 the two countries agreed to raise a 2020 clean-energy target by 2 terawatt hours, enough to power about 80,000 Swedish homes a year.
Triventus has developed 124 megawatts of projects that it has sold on for construction, while Havgul’s, including a 350-megawatt offshore farm, are still in the pipeline.
Scandinavia has attracted a lot of interest from investors as the countries offer low risks along with their low returns, David Hostert, a European wind-energy analyst for Bloomberg New Energy Finance, said by e-mail. Last year saw almost 1 gigawatt of development assets change hands, signaling the trend will continue, he said.
“However, these are very different markets,” Hostert said. “Sweden, for example, is not short on permitted projects, but market conditions are tough. With low wholesale prices and very low Renewable Electricity Certificate prices, only the most competitive projects will stand a chance.”
In Finland, the challenges are in getting permission for projects and the cost of equipment, though a larger company may be able to strike better deals, the analyst said.
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