Allco Finance Group Ltd., an Australian manager of aircraft and property, agreed to buy $200 million (€151.6 million) of wind energy assets in Germany and France as part of a plan to start a new investment fund.
The wind farms have a capacity of 112 megawatts, Sydney-based Allco Finance Group Ltd. said in a statement today. The firm entered partnerships with closely held German developers WPD AG and JUWI GmbH to purchase wind farms and energy projects. Executive Chairman David Coe has eight wind projects under construction or operating in the US and Europe as Allco buys energy assets, aircraft and property to boost management fees and earn more from leasing.
In December, the firm unveiled plans to build a $2.5 billion (€1.9 billion) wind energy project in California to take advantage of rising institutional demand for wind investments. Allco has a global pipeline of development projects with capacity of more than 2,000 megawatts, said Steen Stavnsbo, head of the firm’s wind energy business. The European purchases include three wind farms in Germany, with a capacity of 60 megawatts, according to the statement. The agreement also covers eight wind energy projects in Germany and France totaling 48.5 megawatts. Allco’s shares closed 3 cents lower to A$11.05 in Sydney. Assets under management held in investment funds rose 36% to A$6 billion (€3.6 billion; $4.8 billion) in the six months ended December 31.
The California project, the largest wind farm in the US, will be as much as 75% debt funded. Allco is in the process of inviting partners to join the venture. Edison International’s Southern California Edison unit will buy the power produced by the plant. The project is in Tehachapi, a rural region northeast of Los Angeles where there have been wind turbines since the 1980s. North American and Australian institutions will probably invest in a fund that will develop the project with Allco, Nick Bain, global head of Allco’s infrastructure business, said December 22.
Today’s $200 million investment includes construction costs for a 24-megawatt wind farm in Tehachapi that will be operational by October, the statement said. Wind power is gaining in popularity among utilities as the most cost-competitive form of renewable energy. US power producers will spend more than $4 billion this year to construct a record 3,000 megawatts of wind turbine generators, the American Wind Energy Association said January 23.
The installations will top last year’s 2,454 megawatts of wind turbines and bring the US total to almost 15,000 megawatts. Allco is part of a Macquarie Bank Ltd.-led buyout group bidding A$11.1 billion for Qantas Airways Ltd., Australia’s largest airline. Sydney-based Macquarie is the nation’s largest securities firm. (Bloomberg)