AES Buys Northern Ireland's Ballylumford Power Plant

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Written by Martin Lynch, European News Editor for Industrial Info (Galway, Ireland)--United States-based global power company The AES Corporation (NYSE:AES) (Arlington, Virginia) has become the largest energy utility in Northern Ireland, following its acquisition of Premier Power Limited (Ballylumford, Antrim) for 123 million euros ($158 million).

The cash transaction was made by AES subsidiary AES Ballylumford Holdings Limited and includes the 1,246-megawatt (MW) natural gas-fired Ballylumford Power Station in County Antrim. The acquisition expands AES' operating capacity in Northern Ireland to 1,868 MW, or 15% of the Single Electricity Market, which serves Northern Ireland and the Republic of Ireland.

Ballylumford is the largest power plant on the island of Ireland, and most of the facility's output is contracted to Northern Ireland Electricity. Northern Ireland was the first foreign market in which AES invested, when nearly 20 years ago the company bought the 622-MW coal- and oil-fired plant at Kilroot in Carrickfergus. AES added a further 84 MW of peaking capacity at Kilroot in 2009.

"Ballylumford Power Station will increase AES capacity while providing important fuel diversification and will complement our nearly two decades of operations experience serving the Northern Ireland market," said Paul Hanrahan, the president and chief executive officer of AES. "As a result of our strong liquidity and our familiarity with Northern Ireland, we were able to move quickly on the opportunity and acquire a business that complements our fleet. The Ballylumford acquisition will contribute accretive near-term earnings, creating value for our shareholders."

AES has been actively increasing its European footprint throughout 2010. In April, its AES Wind Generation subsidiary announced the acquisitions of U.K.-based Your Energy Limited (YEL) (London) and a 51% stake in the portfolio of Polish wind power developer 3E Limited (Gyndia, Poland). The YEL acquisition resulted in 300 MW of projects, while the 3E acquisition--the company's first foray into the Polish energy market--gives AES a 51% stake in 422 MW of wind projects.

AES is planning to begin development of 34 MW from the 3E pipeline this year, with a further 120 MW commencing construction next year. For additional information, see April 16, 2010, article - AES Strengthens European Wind Portfolio Through U.K. and Polish Acquisitions.

In June, AES continued its drive into the Polish market by signing an agreement with Polish wind power developer Jan Reichert, giving AES a 51% stake in a 353-MW development pipeline. For additional information, see June 17, 2010, article - AES Wind Generation Strengthens Presence in the Polish Wind Power Market.

In recent weeks, the company announced plans to build a 300 million euro ($386 million) solar power park in Bulgaria. The proposed 80-MW solar park will be located at an unused airfield near Silistra, in northeastern Bulgaria. For additional information, see August 3, 2010, article - AES Plans 80-Megawatt Solar Park for Bulgaria.

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