Origin buys Australian wind farm rights from Conergy

Climate Ark, via Bloomberg: Origin Energy Ltd., Australia’s second-biggest energy retailer, bought rights to develop wind farms from Conergy AG, as it enters wind power generation to benefit from regulations supporting renewable energy use. Origin bought the rights to develop three 30-megawatt projects in New South Wales state, and formed an alliance with Conergy’s Australian unit, Epuron Pty, for the possible development of a further 500 megawatts, the Sydney-based company said today in a statement.

Conergy, Germany’s largest solar-power company, announced plans in October to spend A$2 billion ($1.7 billion) to build Australia’s biggest wind energy project as it expands sales beyond its home market to tap rising demand for cleaner energy supplies. Australia’s Labor government has a target to generate 20 percent of the nation’s power from renewable sources by 2020.

“It’s an interesting move on Origin’s part,” said Grace Chan, a utilities analyst at JPMorgan Chase & Co. in Sydney. “ Given the renewable energy target “everyone agrees that wind is going to be the main plank of that push; solar and geothermal are still too far off in terms of technology at the moment to really be a viable form.”

Origin Energy fell 19 cents, or 2.4 percent, to A$7.81 on the Australian Stock Exchange at 12:28 p.m. local time in Sydney, bettering a decline of 3.8 percent in the exchange’s benchmark utilities index.

So far, Origin has committed to building a single project, the 30-megawatt Cullerin Ridge venture west of Goulburn, which will start up in 2009, the company said in the statement, sent to the exchange. The project will supply enough power to fuel almost 15,000 typical homes in New South Wales.

That project will cost between A$75 million and A$90 million, based on estimates that each megawatt of wind power capacity costs between A$2.5 million and A$3 million to install, Amanda Lampe, an Origin spokeswoman, said in a telephone interview. The other two projects to which Origin bought the rights, the Conroy’s Gap and Snowy Plains ventures, may cost a similar amount, she said.


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