Wind farm expansion hinted

South Eastern Times
Tuesday 26/2/2008 Page: 2

AN EXPANSION of the Woakwine Range Wind Farm has been hinted by the international investment bank which owns 100 of the giant turbines worth more than $200 million. Babcock and Brown Wind Partners recently completed the second stage of its Lake Bonney Wind Farm. [The other company which owns 23 adjacent and near-identical turbines is International Power and its investment is called the Canunda Wind Farm].

There has been speculation in the past decade that Babcock and Brown Wind Partners will expand northwards along the WoakWine Range with its third and fourth stage. The international parent company of Babcock and Brown Wind Partners is Babcock and Brown Limited and it has recently reported a 58% profit increase to $643 million for the 2007 financial year. The contribution of the Lake Bonney wind farm to this result was not stated in the annual report.

However, Babcock and Brown CEO Phil Green said in his annual report that world-wide wind farm expansion was a priority. "In light of the the demand for infrastructure assets globally and in particular renewable energy assets, we believe our development pipeline currently has significant embedded value not recognised by the market. "Babcock and Brown has a wind energy development pipeline in excess of 16,000 megawatts globally to be delivered over the next two to eight years," said Mr Green.

He said his company had a high quality wind energy portfolio which was diversified by wind region, geography, regulatory regime, turbine manufacturers and development initiatives. "Investment in the pipeline including operating wind farms still on the Babcock and Brown balance sheet at the present time is approximately $1.2 billion. "We remain committed to the ongoing expansion and development of our portfolio. "wind energy is based on proven technology as is evidenced by the fact that the cost of wind energy is now equivalent or close to equivalent to gas-fired power production costs at newly installed facilities in most major energy markets.

"This will see demand for new wind energy capacity remain strong. "We believe a significant valuation gap has emerged between the value attributed by the stock market to Babcock and Brown's assets in the sector and the value achieved for these assets on the open market in recent trade sales and stock market listings. "Our portfolio combined with the Babcock and Brown Wind Partners is in the top three in the world in terms of megawatts and is of the highest quality in terms of deliverability," said Mr Green.