AES Strengthens European Wind Portfolio Through U.K. and Polish Acquisitions

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Researched by Industrial Info Resources (Sugar Land, Texas)--United States-based global power company The AES Corporation (NYSE:AES) (Arlington, Virginia), through its wholly owned subsidiary AES Wind Generation, recently 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 development trail gained from the YEL acquisition exceeds 300 megawatts (MW) of projects. Of this, AES intends to begin construction of 48 MW by the end of 2010. In January this year, AES brought the company's first U.K. wind project online: the 22-MW North Rhins wind project in Scotland.

The 3E acquisition is a 51% stake in 422 MW of wind projects. This represents AES' first foray into the Polish market. AES expects to commence development of 34 MW from the 3E pipeline in 2010, with a further 120 MW commencing construction next year.

Apart from AES, several leading wind energy companies, including General Electric Company (NYSE:GE) (Fairfield, Connecticut) and Siemens AG (NYSE:SI) (Munich, Germany), have recently announced intentions to develop wind projects in the U.K. as the country moves toward its renewable energy targets.

Many European countries are working to meet the 2009 European Union Renewable Energy Directive, which among others requires that both the U.K. and Poland produce 15% of their gross energy from renewable sources by 2020. The U.K. is heavily targeting wind power and expects to bring an additional 20,000 MW of wind generating capacity online by 2020, while Poland is expected to raise its wind generating capacity by 6,000 MW.

Progress in meeting the targets has been patchy, according to a report issued by the European Commissioner. With targets for 2010 varying considerably from country to country, only Denmark, Germany, Hungary and the Netherlands have achieved good results toward meeting their interim targets of 29%, 12.5%, 3.6% and 9%, respectively. Both the U.K. and Poland have made less than 30% progress toward meeting their respective 2010 targets of 10% and 7.5%.

AES Wind Generation operates approximately 1,700 MW of wind-powered electricity generation worldwide and has a current development pipeline of projects totaling 6,000 MW spread across North America, Asia and Europe.

While AES operates 132 power generation plants worldwide, covering a wide range of fuel sources, including coal, diesel, biomass and hydropower, the company is increasing its use of renewable energy. Another AES subsidiary, AES Solar Energy Limited announced earlier this month the financial closure of a 43-MW solar project in Italy that will more than double the company's current solar generating capacity.

This year, in addition to the North Rhins project, AES Wind Generation has successfully completed two other wind projects in Europe: the 156-MW St. Nikola at Kavarna project in Bulgaria and the 35-MW St. Patrick project in France.

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