Joint venture to spend €180m on US wind farm

A JOINT venture involving Airtricity founder Eddie O’Connor’s Mainstream Renewable Energy plans to spend €180 million building a wind farm in the US after winning a 20-year electricity supply contract.

Mr O’Connor confirmed yesterday that Tianrun Shady Oaks, a joint venture between Mainstream and Chinese wind turbine manufacturer, Goldwind, has won a 20- year electricity purchase agreement from the Illinois Power Agency.

It intends to build a 120 megawatt (MW) wind farm in Illinois, which Mr O’Connor said yesterday would involve an investment of about $240 million (€182 million).

The contract was one of a number handed out by the Illinois agency for green energy supplies following a series of competitions.

The Irish-Chinese joint venture was the only non-utility competing for the power purchase deal. On that basis, Mr O’Connor said that the contract was a significant one for his business.

The other contracts were handed out to enterprises backed by the likes of Spanish utility, Iberdrola, Portuguese player, EDP and US electricity company, Florida Power and Light (FPL). Mr O’Connor said that Tianrun faced similar competition in its bid.

The Irish company identified the opportunity and recruited Golden Wind as a partner to supply the turbines and technology needed for the project.

The wind farm will consist of more than 70 turbines and will generate enough electricity to supply power to about 40,000 homes at full capacity.

Most US states use tax incentives to encourage investment in renewable energy. Falling energy prices, brought on by the recession, has slowed the rate of investment in the sector over the last year.

The Illinois contracts were granted on the basis of price. Tianrun will be paid about $55.15 per mega watt hour.

Mr O’Connor was the founding chief executive of Airtricity, which is now one of the main independent competitors in the Irish electricity and gas markets to the ESB and An Bord Gáis.

Mr O’Connor set up Mainstream after the €1 billion sale of Airtricity to its current owner, Scottish and Southern Energy (SSE), with the aim of identifying and investing new renewable energy projects in Ireland and around the world.

The company has interests in the US, Canada and Europe, where it has won three major licences from the British government.

Goldwind is the biggest wind turbine manufacturer in China and among the top five in the world, where it ranks with the likes of Siemens and Iberdrola.