E.on sells 50% in 433 MW of US wind farms to PensionDanmark

Oct 8, 2012 - German utility E.on AG (ETR:EOAN) said Monday it had sold to Danish pension fund PensionDanmark 50% stakes in three operating wind farms in the US, whose combined capacity stands at 433 MW.

Financial details were not provided.

The move will free up funds for E.on’s other renewable energy projects in the pipeline, the company said. Chief financial officer Marcus Schenck said that similar transactions were "likely to follow".

The projects include the Papalote Creek I and II facilities in Texas with capacities of 180 MW and 200 MW, respectively, and the 53-MW Stony Creek wind farm in Pennsylvania. All have commenced operation between October 2009 and December 2010 and have power purchase agreements with US utilities.

For PensionDanmark the purchase of the 50% interests in the power plants represents an alternative to investment in securities. "Our investment in wind farms in Denmark, and also in the USA, will provide a stable and attractive return at a level very similar to what you can expect from equities, but with a significant less risk and expose to the business cycle, so we will continue to focus strongly on investment of this type," said the pension fund's chief executive officer Torben Moeger Pedersen.

Following the acquisition, which is still subject to regulatory clearing and certain financial arrangements, E.on will remain in charge of the day-to-day operation of the wind farms.

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