A consortium of Engie, Crédit Agricole Assurances and Mirova, an affiliate of Natixis Investment Managers, have been named as the new operators of Portugal’s second largest hydroelectric portfolio after winning a competitive bidding process conducted by EDP. The deal is valued at €2.2 billion.
The hydroelectric portfolio has a generation capacity of 1.7 GW with a weighted average remaining concession term of 45 years, and includes three newly commissioned pumped storage units along with three recently repowered run-of-river plants.
Engie, as the industrial partner for the consortium, will operate and maintain the hydroelectric portfolio and also provide energy management services.
The acquisition of the hydroelectric portfolio is instrumental to the deployment of Engie’s zero-carbon strategy, bringing flexible renewable capacity which complements Engie’s existing Iberian portfolio of onshore wind (1.1GW) and solar (50MW) power, most of which is already in partnership with Mirova, the company said in a statement.
Through this transaction, Engie said it will secure a significant level of dispatchable renewable power generation, notably via the pumped storage assets, which allows it to provide green corporate PPAs on an “as consumed” basis to its clients. In the medium to long term, and as Engie further expands its wind and solar portfolio, the pumped storage hydro production will become more valuable given the inherent intermittency of wind and solar assets.
Crédit Agricole Assurances, the first insurance company in France, is strengthening its commitment to the energy transition through the transaction, which is fully integrated into the Crédit Agricole group's climate strategy.
This transaction also continues a long-standing relationship between Mirova and Engie, developed over the past years notably by partnering in several projects in wind and solar in Europe. Mirova will invest via its fund Mirova Eurofideme 4, dedicated to the European energy transition and a dedicated co-investment fund created for the purpose of this transaction.
Engie owns 40% of the consortium, while Crédit Agricole Assurances and Mirova, through managed funds, owning 35% and 25%, respectively.
Closing of the transaction is expected during the second half of 2020.