Company of the Week - Gaelectric to raise €60m for Irish wind energy

Gaelectric is raising €60 million from capital markets to fund a series of proposed developments in Ireland.

Gaelectric said yesterday that the company had just secured planning permission for two onshore wind-power plants in Co Derry, at Smulgedon, north east of Dúngiven and Monnaboy on Loughtermore Mountain.

The two would have the capacity to generate a total of 25 mega watts (MW) of electricity, the Dublin-based company added.

It also emerged that Gaelectric has hired Royal Bank of Canada Capital Markets to aid it in raising €60 million to fund a series of projects that it is planning across Ireland.

The company now has planning approval for plants with a total capacity of 130MW around the country, which would require a total investment in the region of €260 million.

Gaelectric has already raised €80 million in equity, loan notes and other instruments from the capital markets to help pay for its development pipeline.

The fund raising now under way is likely to feature a similar mix. Chief executive Brendan McGrath yesterday described the initial response as “very encouraging”.

The company began generating electricity from its first wind farm at Skrine, Co Sligo, last year, and expects that another, at Carn Hill, close to Belfast, will come on stream early in 2013.

Once that is functioning, Gaelectric will have completed wind farms with the capacity to generate up to 20MW of electricity.

The company intends to finish work on its Irish projects by 2016. Mr McGrath indicated yesterday that the company was reaching the end of the planning stage.

“We have now reached a stage of maturity in this end of our business where most of our projects are either at financial close, construction ready, or have consents in place, including firm grid offers,” he said.

Along with planning permission, wind farms need licences and grid connections that will allow them to supply power to the country’s electricity networks.

The energy industry hopes that market supports, such as the guaranteed prices offered to wind energy projects in the Republic, will help attract more institutional investors and venture capitalists to the industry.

Gaelectric also has plans to build wind farms with a total capacity of 510MW in Montana in the north western US by 2015.

Over the longer term in the US, it is hoping to erect enough turbines to generate 1,435MW of electricity at full capacity.

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