SSE Renewables (SSE) has boosted its European expansion plans, snapping up a 3.9GW portfolio of onshore wind developments from Siemens Gamesa Renewable Energy (SGRE) in a €580m (£483m) deal.
The SGRE portfolio includes projects across the continent, around half of which are located in Spain with the remainder across France, Italy and Greece.
It also includes scope for up to 1GW of additional solar development opportunities.
The deal does not require SSE shareholder confirmation.
It will be completed by the end of September 2022, subject to regulatory approval.
The transaction marks SSE’s entrance into Southern Europe, and builds on its renewables business in the UK and Ireland, where the firm owns and operates 4GW of renewable assets.
This includes nearly 2GW of onshore wind, with a secured pipeline of nearly 11GW across onshore wind, offshore wind and hydro projects.
SSE is aiming to have around 500MW of renewable projects from the SGRE portfolio operational by March 2026, with a further at least 500MW in construction.
This will contribute to its expansion target of 4GW over five years, doubling its installed renewables capacity to 8GW by 2026.
It is aiming to treble installed renewables capacity to over 13GW, with a fivefold increase in renewables output to 50TWh annually by 2031.
SSE is currently leading the construction of the world’s largest wind farm, Dogger Bank , with a 40 per cent share of the 3.6GW project.
Stephen Wheeler, managing director of SSE Renewables, said: ” Mainland Europe is an exciting growth market for onshore wind, with clear carbon reduction targets and supportive policies, and the expert management team will complement our sector-leading capabilities perfectly. The project portfolio brings some excellent assets and will provide a real springboard for our expansion plans in Europe across wind, solar, batteries and hydrogen.”
Commenting on the deal, Laura Hoy, equity analyst at Hargreaves Lansdown, said: “Growth opportunities are few and far between for utilities, but with governments around the world determined to use renewables to establish energy independence, there’s a unique chance for utilities to revamp their businesses. “
“This comes with quite a lot of risk though, and that’s something the typical utility share holder may not be comfortable with. In SSE’s case, the group will have to find a way to grow its renewables division without treading on its dividend. This is particularly true as inflation continues to rage and investors search for ways to keep their savings from eroding further.”