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Renewable Energy M&A: Copenhagen Infrastructure Partners (CIP) buys into a $5bn renewable energy hub in Australia

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CIP will acquire the renewable energy assets of the Bowen Renewable Energy Hub - being developed by state-owned CS Energy, Bowen River Utilities, and Renewable Energy Partners - in Queensland. The project comprises a 1.4 GW pumped hydro project, dubbed the ‘Battery of the North’, the 500 MW Eungella wind farm, and 1.3 GW of solar capacity and a 200 MW electrolyzer. The deal marks CIP’s entry into Queensland and will complement its existing investments in the 2.2 GW Star of the South offshore wind project, as well as the 5 GW Murchison Renewable Hydrogen project in Western Australia. The Bowen Renewables Hub will help the government of Queensland reach its targets to increase the share of clean energy in its power mix from 20% currently to 50% by 2035, and cut carbon emissions by 30% within the same timeframe. 

The project would be delivered in two phases, with the first phase targeting 750 MW of generation capacity and 16 hrs of storage by 2028. Stage two would also target the establishment of 16 hours of storage capacity, to be brought online by 2033. The project would connect to the National Electricity Market; CS Energy is in the process of negotiating power purchase agreements (PPAs) for the produced electricity. While the exact financing structure for the initiative has not been disclosed, CIP and Bowen River Utilities have executed a co-development and equity partnership to deliver the project. According to Enerdatics’ research, CIP has been in talks to acquire a stake in the project since Aug’22, after a partner at the firm highlighted the company’s plans to expand its presence in Australia’s renewables sector, driven by ambitious state-government targets. 

As per Enerdatics’ M&A intelligence, Australia has recorded nearly a 40% year-on-year spike in deal volume so far in 2022, driven by the entry of several large-scale players in gigawatt-sized renewable energy projects and hubs. Last week, European Energy acquired a majority stake in the 3.6 GW Pacific Solar Hydrogen Project in the Gladstone region, while earlier this year oil major bp acquired a 41% stake in the Asian Renewable Energy Hub, which comprises 26 GW of wind and solar projects. Other European oil majors Equinor and TotalEnergies have also formed partnerships to pursue offshore wind and green hydrogen projects in the country.

The above analysis is proprietary to Enerdatics’ energy analytics team, based on the current understanding of the available data. The information is subject to change and should not be taken to constitute professional advice or a recommendation.

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