Italian energy company ERG SpA (BIT:ERG) last week unveiled its 2021-2025 business plan and ambitions to invest EUR 1.9 billion (USD 2.31bn) to lift its installed renewable energy capacity by 1.5 GW.
According to the strategy, ERG will have 4.7 GW of installed renewable power plants in operation by end-2025.
“Over 3 GW of installed capacity and 3 GW of projects under development are the basis on which to start a new phase of growth and transformation,” said CEO Paolo Luigi Merli. He stated that more than 60% of the final goal is guaranteed by projects under construction or at an advanced stage of development.
The Italian company intends to pour some EUR 2.1 billion into its business throughout the five-year period, of which 90% will be earmarked for renewables.
The 1,500-MW goal is to be attained through a combination of repowering, greenfield and co-development projects along with acquisitions. Of this total, around 400 MW is already under construction in the UK, Poland and France, while a 62-MW project is shovel-ready in Sweden. Roughly 600 MW of capacity will be added through acquisitions and 300 MW will come from the development of wind and solar schemes. The remaining 200 MW is set aside for wind repowerings in Italy.
On the financial side, ERG will strive to source 80% of its earnings before interest, tax, depreciation and amortisation (EBITDA) through auctions or power purchase agreements (PPAs). On Friday, the company announced the signing of a 10-year contract to supply 3.4 TWh of wind power to information and communications technology (ICT) group TIM SpA (BIT:TIT).
ERG's EBITDA is set to reach EUR 550 million in 2025, rising from EUR 481 million in 2020, with 70% of the earnings coming from the domestic market.
Apart from its capacity ambitions, the energy company aims to strengthen its foothold in new markets such as Sweden and Spain, where it stepped recently for the first time.
ERG also said it will seek to diversify technologically by exploring options in the energy storage and hydrogen sectors.
(EUR 1.0 = USD 1.215)
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Wind farm. Author: fantastklywell.
