REG - SSE Plc - SSE acquires SGRE onshore wind platform

SSEAnnouncement

20/04/2022 07:00

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RNS Number : 6654I  SSE PLC  20 April 2022

 

SSE acquires European onshore wind platform from Siemens Gamesa Renewable
Energy

·    Transaction marks SSE's entry into Southern Europe and brings a
c.3.9GW portfolio of onshore wind development projects across Spain, France,
Italy and Greece.

·    Builds platform for SSE's growth in Europe where it aims to progress
a balanced portfolio of assets across wind, solar, batteries and hydrogen
technologies.

 

SSE Renewables has entered into an agreement with Siemens Gamesa Renewable
Energy (SGRE) to acquire its existing European renewable energy development
platform for a consideration of €580m 1 .

The SGRE portfolio includes c.3.9GW of onshore wind development projects -
around half of which is located in Spain with the remainder across France,
Italy and Greece - with scope for up to 1GW of additional co-located solar
development opportunities. SSE will also take on a team of around 40 employees
with vast experience in the sector.

The transaction is likely to complete by the end of September 2022, subject to
receipt of relevant foreign direct investment and regulatory approvals. The
transaction does not require SSE shareholders' approval.

The acquisition marks SSE's entry into Southern Europe, building on its
successful renewables business in the UK and Ireland where it owns and
operates 4GW of renewable assets, including nearly 2GW of onshore wind, with a
secured pipeline of nearly 11GW across onshore wind, offshore wind and hydro
projects.

The addition of the SGRE platform is highly complementary to SSE's strategic
objectives and is consistent with the SSE Group's Net Zero Acceleration
Programme (NZAP), which outlines fully funded £12.5bn capital investment
plans to 2026 alongside ambitious 2031 targets, aligned with 1.5 degree
science based targets.

SSE Renewables is aiming to have around 500MW of renewable projects from the
SGRE portfolio operational by March 2026, with a further at least 500MW in
construction. This will contribute to the NZAP targets of:

·    4GW of net additions over five years, doubling installed renewables
capacity to 8GW (net) by 2026;

·    maintaining a pipeline of at least 15GW of renewables development
projects;

·    targeting delivery of at least 1GW net capacity additions per year
during the second half of the decade; thereby

·    trebling installed renewables capacity to over 13GW (net) and in turn
target a fivefold increase in renewables output to 50TWh annually by 2031.

 

The transaction will bring together the existing SGRE management team's
significant development experience across continental Europe and SSE's
expertise in constructing and operating wind farms, supported by its balance
sheet strength. With many of the projects in the SGRE portfolio at an early
stage of development, the existing SGRE teams will be an integral part of
progressing the projects and supporting SSE's growth strategy in Europe.

The four countries in which the SGRE portfolio of development assets are
located have strong growth prospects, underpinned by 2030 renewables or carbon
reduction targets and attractive remuneration schemes. The platform, alongside
the experienced development teams, will provide an excellent base for
continued sourcing of development opportunities across onshore and offshore
wind, solar, batteries and hydrogen, all of which are core to SSE's growth
strategy. It also presents opportunities to enter wider European markets.

As part of the transaction, SSE Renewables will have the opportunity to
partner with SGRE on the provision of turbines and associated long-term
maintenance services for a portion of wind farms in the portfolio.

Stephen Wheeler, Managing Director of SSE Renewables, said: "We are delighted
to boost the delivery of SSE's Net Zero Acceleration Programme by expanding
our existing renewables business into Southern Europe through this
acquisition. Mainland Europe is an exciting growth market for onshore wind,
with clear carbon reduction targets and supportive policies, and the expert
management team will complement our sector-leading capabilities perfectly. The
project portfolio brings some excellent assets and will provide a real
springboard for our expansion plans in Europe across wind, solar, batteries
and hydrogen."

This acquisition strengthens SSE Renewables' position as a leading renewables
developer. The company is currently building more offshore wind capacity than
any other company in the world: it is leading the construction of the world's
largest wind farm, Dogger Bank (3,600MW, SSE share 40%) and the world's
deepest fixed bottom offshore wind farm, Seagreen (1,075MW, SSE share 49%).
Additionally, it is currently building the wholly owned Viking onshore wind
farm (443MW) in Shetland, expected to be one of the UK's most productive wind
farms on completion. SSE Renewables' development pipeline includes one of the
world's largest offshore wind opportunities, Berwick Bank (4.1GW) as well as a
floating wind site of up to 2.6GW (SSE share 40%) in Scotland secured in the
ScotWind leasing round. On the international front, SSE Renewables recently
entered the Japanese offshore wind market through the formation of SSE
Pacifico and is actively exploring opportunities in the US and Northern
Europe.

Further information

Spain has some of the most ambitious targets in Europe aiming for renewables
to account for 74% of electricity by 2030 and 100% by 2050. A minimum of 5GW
of onshore wind will be awarded in auctions between 2022 and 2025.

France has a target of 40% of electricity production to come from renewables
by 2030. 10GW of onshore wind will be awarded between 2022 and 2026 through 15
tenders.

Italy is aiming to reduce carbon emissions by up to 60% by 2030 vs 1990
levels. It has an objective to add 8.5GW of onshore wind capacity from 2020 to
2030.

Greece has a target for renewables to account for 32% of final gross
consumption by 2030. Auctions are expected to take place until 2025 with a
minimum quote for wind of 3GW.

Morgan Stanley and Freshfields Bruckhaus Deringer LLP acted as financial and
legal advisors respectively to SSE on the transaction.

ENDS

 Media:  media@sse.com (mailto:media@sse.com)   |  +44 (0)345                    MHP Communications:
 0760 530

                                                                               Oliver Hughes and Simon Hockridge
 Sam Peacock, Glenn Barber, Alexandra Malone

                                                                                 07885 224 532 / 07709 496 125
 Investors: ir@sse.com (mailto:ir@sse.com)   |  +44 (0)345 0760 530 

 Sally Fairbairn, Michael Livingston

 

 

 1  The final price will be subject to customary adjustments for level of
working capital and net debt

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