Forrest takes over CWP to become a dominant player in Australian renewables

Forrest takes over CWP to become a dominant player in Australian renewables

Iron ore billionaire Andrew Forrest has snapped up leading renewable energy developer CWP Renewables, beating a string of big rivals and entrenching it as a dominant player in Australia’s renewables market.

Forrest’s Squadron Energy, owned through its private investment vehicle Tattarang, paid more than $4 billion for CWP Renewables, beating bids from early favorites such as Spanish energy giant Iberdrola, Tilt Renewables and Origin Energy.

CWP’s purchase follows Squadron’s previous purchase of renewable energy developer Windlab, the start of construction of the $3 billion Clarke Creek wind, solar and battery farm in Queensland, and the unveiling of a new 10 GW renewable “super” hub in North Queensland.

Squadron says the deal brings its renewable energy operating portfolio to 2.4 gigawatts (GW) with an Australian development pipeline to 20 GW.

“Squadron is proud to bring a very significant portion of Australia’s renewable energy assets to local ownership. It means Squadron has the critical mass of renewable energy to help Australia move beyond fossil fuels,” said Dr Forrest.

“The ability of Australian industries to make fossil fuels history is strongly demonstrated by the strong track record and commitment of Fortescue Metals, Fortescue Future Industries and other leading global companies committed to decarbonisation.

“We share a vision of Australia and the world, viewing the dark age of fossil fuels as an aberration in human history. One that could have ended with this fuel, but is now powered by cheap, pollution-free and democratic inexhaustible energy.

Billionaires on the move

Forrest’s decision further solidifies the influence of Australia’s three richest men – Forrest and software billionaires Mike Cannon-Brookes and Scott Farquhar – on the future of Australia’s network.

All three have pledged to move quickly into wind, solar and storage, with Cannon-Brookes taking an influential stake in coal giant AGL and co-financing with Forrest the world’s largest solar and battery project, Sun Cable, in the Northern Territory.

Farquhar has also joined the green power rush, leading a bid for one of the latest renewable energy and storage plays listed on the ASX, Genex Power, although there are questions as to whether this offer will continue after problems at the Kidston flagship pumped hydroelectric project. .

Other changes in the industry come from the planned takeover of Origin Energy by a consortium led by Canadian fund management giant Brookfield, which says it plans to spend $20 billion on new projects. wind, solar and storage by 2030 as the shift to green energy accelerates. .

CWP is one of the largest players in the Australian renewables market, with over 1.1GW of assets in operation, including the Sapphire, Murra Warra, Crudine Ridge and Bango wind farms, as well as a host of other wind, solar and battery storage projects in the pipeline.

The largest player in the Australian market

Forrest has already spoken – repeatedly – of becoming one of the world’s leading producers of green hydrogen, with an unlikely goal of producing 15 million tonnes per year by 2030.

But it now appears to have a growing interest in becoming the biggest player in Australia’s major grids, still focusing on achieving 100% renewables and large-scale green hydrogen production, but probably for the domestic market rather than the disputed export market. by transportation costs.

CWP is being sold by Switzerland-based Partners Group, which manages more than $185 billion in assets and said it built CWP from the ground up to become a major player with a 5GW pipeline of near-term projects and a An additional 15 GW at an early stage of development.

“We are proud to have built a major renewable energy platform that is set to play a key role in decarbonising Australia’s energy mix and helping the country and its businesses achieve their ambitious net zero ambitions,” said Martin Scott, Head of Partners Group. in Australia.

Forrest said it was important that Australian energy assets were owned by Australian interests.

It’s time to get rid of dangerous fossil fuels

“It is paramount that Australia continues to increase cost-effective renewable green energy, to economically power homes and industry at pace and rid the Australian consumer of their forced dependence on increasingly expensive and dangerously polluting fossil fuels. “, he said in a statement.

“We are committed to ensuring that Australians benefit from increased job opportunities and massive investment in the renewable energy sector. The new jobs, manufacturing and training opportunities, especially in regional areas, are so important in ensuring that generations of Australians across the country benefit.

CWP squadron forrest eva hanly
Eva Hanly, CEO of Squadron Energy, Jason Willoughby, CEO of CWP Renewables, and Andrew Forrest, President of Tattarang. Photo credit: Frances Andrijich

Squadron CEO Eva Hanly says the company has the “experience, people, agility and scale” to meet the huge demand for green power from large commercial and industrial customers.

“When large industrial and commercial customers come to us, they’re looking for efficient, firm-scale renewable energy,” Hanly said.

Night and day wind

“With this acquisition, we will develop and operate a broad geographic portfolio of wind, solar, and night and daytime storage assets that will ensure supply reliability for our customers.

“The sooner we can integrate large-scale renewable energy into the grid, the faster prices will come down for consumers. We are very focused on using our scale and our intelligence to ensure that we are the leader, by a significant margin, providing the lowest production cost of solid renewable energy on the market.

Hanley says Squadron will begin construction on another project worth 2 GW over the next 18 months.

Squadron was advised by Highbury Partnership as financial advisor and Clayton Utz as legal advisor. Partners Group was advised by Macquarie Capital as financial advisor and Clifford Chance as legal advisor.

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