Growth plan for the short-term
EDPR’s growth plan for the 2012-2015 period was presented to our investor community at the 2012 Investor Day. This plan foresees the addition of 2.3 GW of renewable energy over the four year period. The first step of this process has already been successfully achieved with the addition of 504 MW in 2012. For the following years capacity addition will be split between growth markets, core markets and new markets and/or new technologies.
EDPR’s capacity additions in the upcoming years will be strongly focused on the growth markets of Eastern Europe, Western Europe (excluding Iberia) and Brazil. The strong development efforts that followed EDPRs entry into these markets, some years ago, are now bearing fruit. For the 2013-2015 period these countries will account for 60% of capacity additions, with the Eastern European markets representing a sizable stake.
Eastern Europe is expected to account for more than one third of the 2012-2015 growth plan. This sizable investment in these geographies is based on market attractiveness and stable legal and transparent regulatory frameworks.
France, Belgium and Brazil will also contribute to EDPR growth in this period. All of these geographies provide long-term visibility for EDPR future investments.
Due to market maturity and regulatory issues, growth in our core markets of Spain, Portugal and the US will slow vis-à-vis the last years.
North America’s growth will depend on the eligibility for the Production Tax Credit (PTC) incentive scheme and/or attractive PPA opportunities with off-takers.
In Spain and Portugal, moratoria on the eligibility of new wind farms for incentive schemes has forced EDPR to halt new investments. However the projects that fall under previous regulatory agreements will continue to be executed, such as the ENEOP project in Portugal or overpowering of existing wind farms.
NEW MARKETS AND TECHNOLOGIES
Entering new markets and/or technologies is one of the main strategic initiatives that EDPR has set out in its growth plan. The execution of this strategic initiative will account for 12% of 2013-2015 growth.
EDPR’s teams have been identifying a number of prospective countries that fit our strict investment criteria. The growth potential, quality of the wind, or solar, resource and the availability of stable long-term remuneration frameworks are just some of the important criteria considered for potential investment.
Entering into new technologies is an objective that has already started to be executed. As a result of the sharp increase in competitiveness, the high growth potential of this technology, and the excellent opportunity that was identified in Romania, EDPR installed in 2012 its first solar power plants.
We see great promise in this technology and expect that it will provide top quality growth opportunities in the short and long-run.