Sell-off to fund NE wind project

Hobart Mercury
6 September 2011, Page: 13

A sell down of Circular Head Council wind farm assets should help Hydro Tasmania finance its $400 million Musselroe wind farm proposal. The State Government owned electricity generator yesterday said it was seeking a buyer for as much as 75% of its Woolnorth wind farm assets. The divestment follows this year's split of the Roaring 40s joint venture in which partner China Light and Power took full ownership of the venture's interstate wind farms. The move left Hydro Tasmania with full ownership of the 65 MW Bluff Point and 75 MW Studland Bay wind farms, which are on the giant Woolnorth property in the North-West.

Hydro Tasmania chief executive Roy Adair said he hoped the divestment process, to be managed by ANZ Project Advisory, could be finalised by the end of this year. Mr Adair said he anticipated that a new financial partner would take a stake in the 168 MW Musselroe project "Work on Musselroe is expected to progress materially in November this year with construction of the transmission line", he said.

Mr Adair said Musselroe, in the North-East, was a priority for cementing Tasmania's position as a renewable energy leader. "We are in the process of finalising new construction contracts and the choice of turbine suppliers", he said. Hydro chairman David Crean said the board also saw the move as a way of tackling Hydro Tasmania's debt. "Although today's announcement is primarily about progressing our wind development plan over the next decade, it is also about ensuring we achieve our other objectives, such as further mainland retail growth and improving our financial strength to BBB [rating] by 2015", Mr Crean said.

Mr Adair said Hydro was committed to wind farm expansion to complement its generation assets, which made it Australia's largest renewable energy generator. "A critical part of the financing strategy is appropriate equity investment from the private sector to ensure Hydro Tasmania is able to optimise its financial position, reduce its debt and continue to deliver strong returns to its owners", he said. Bluff Point, commissioned in 2004, has 37 turbines and Studland Bay has 27.