18 January 2010
Renewable Energy Generation Ltd
Acquisition of fully consented site and operational update
Renewable Energy Generation Limited ("REG" or the "Company") (AIM: WIND), the UK renewable energy group, today provides an update on the business following recent developments.
Acquisition of consented site
REG has acquired a fully consented wind site at High Haswell in County Durham for a cash consideration of £0.8m. It is anticipated that two 2MW turbines will be installed on the site with expected combined output of approximately 12GWh per annum. Turbines are being ordered and the project is expected to become operational towards the end of calendar 2010.
REG is experiencing a favourable environment for turbine procurement at present and has placed an order with Acciona of Spain for three 1.5MW turbines for its fully consented site at Loscar near Rotherham. Once operational, this site is expected to produce approximately 11GWh of output per annum. Project completion is expected in autumn 2010.
A turbine order for the Company's consented site at Goonhilly Downs is currently being negotiated and is expected to be closed within the next few weeks. Delivery is expected in late summer 2010 with operation scheduled to commence in autumn 2010. When complete this site is forecast to produce approximately 29GWh of output per annum.
It is anticipated that these three developments will almost double REG's operational output from wind in the UK. In addition, REG has a number of other projects nearing planning determination and is optimistic that further significant capacity will be consented this calendar year.
The Company aims to invest around £100 million of debt and equity into UK wind projects over the next three years and is in discussion with a number of banks regarding a long term structured financing facility.
Operations from wind
Output fromREG's operational wind sites in the UK was slightly ahead of management's expectations during the first half of the current year due to higher wind levels. A further update will be provided with the Company's interim financial results, which will be published on 18 March 2010.
REG Bio-Power generated 2.78GWh of output during the first half of the year from its two operational plants at Hockwold and Bentwaters. The business has continued to invest in research and development although this is expected to reduce in the second half of the year as the remaining units at the Bentwaters project become fully operational following completion of environmental permitting. Additionally, REG Bio-Power's recently announced project with Port of Dover Authority will commence generation in Q1 2010.
In order to provide sufficient high quality fuel, processed in accordance with its End of Waste accreditation from the Environment Agency, REG Bio-Power will start construction of a new oil processing facility at Hockwold in Norfolk. This will allow REG Bio-Power to process around 15,000 tons of LF 100 per annum, enough to operate around 15MW of renewable energy facilities. The cost of this project will be approximately £0.8m and will be funded from internal resources.
Commenting on developments, Andrew Whalley, Chief Executive Officer, said:
"We are delighted with the acquisition of High Haswell. The site is highly energetic and will provide a sound contribution to local renewable energy targets in County Durham.
"The market for turbine procurement is favourable at present and we are delighted to be able to work with the Spanish turbine manufacturer Acciona on our project at Loscar. We are in the process of securing machines for High Haswell together with the repowering of our existing site at Goonhilly Downs in Cornwall. These sites, together with Loscar, will thus become operational during 2010.
Renewable Energy Generation Ltd
Tel: 01483 901 790
Andrew Whalley, Chief Executive Officer
David Crockford, Finance Director
Numis Securities Ltd
Tel: 020 7260 1000
Nominated Advisor: Simon Blank / Hugh Jonathan
Corporate Broker: David Poutney / Charlie Farquhar
Tel: 020 7357 9477
Notes to Editors
Renewable Energy Generation Ltd (REG) is a UK orientated renewable energy group. The Group's main business is the development, construction and operation of wind farms in the UK and generating power from refined used cooking oil in the UK.
The Cornwall Light & Power Co. Ltd: based in Cornwall, UK, it currently operates seven wind projects in Cambridgeshire, Cornwall, County Durham, Cumbria and Gwynedd, with a total capacity of 21.3MW and has a development pipeline of around 350MW.
REG Bio-Power UK Ltd: based in Nottingham, UK: it operates electricity generation plant fuelled by vegetable oil.
Headquartered in Jersey, REG was admitted to trading on AIM, a market operated by the London Stock Exchange, in May 2005 (AIM: WIND).