Neoen Aims For 10 GW Global Portfolio By 2025

• Neoen says it will be targeting a total renewable energy portfolio of over 10 giga Watt by 2025 under its strategic road map
• it is likely to cost €5.3 billion factoring in rise in construction cost per MW specially for solar energy
• from 2025 it will aim to add at least two GW of project capacity annually
• It forecasts EBITDA of between €295 million and €325 million in 2021, and targets an annual increase of more than 20% in 2022, followed by double-digit annual growth over the 2023-25 period

Neoen has revealed its future strategic roadmap aiming for a total of more than 10 GW of operational or under construction renewables capacity by 2025. This would be a jump from 4.1 GW capacity it had at the end of 2020, which should be comfortable for the French renewable energy company to achieve since it had 6.9 GW capacity at an advanced stage of development in its pipeline till 2020-end.

To achieve this cumulative target, the French company estimates an investment worth €5.3 billion between 2021 and 2025, factoring in 'further improvement in construction costs per MW, especially for solar energy'. It also includes potential asset acquisitions. The management estimates total additional capital needed to fund its growth targets during the period to be a maximum of €1.2 billion.

Further accelerating this growth, Neoen will aim to win a minimum of 2 GW of projects annually from 2025, the management shared during its 2021 Capital Markets Day.

Neoen said it will focus on securing this growth in the markets where it is already active by proposing 'competitive, high value-added projects for both government and corporate customers', offering at least 2 of 3 technologies it actively pursues, comprising solar, wind and storage. Expansion in newer markets will still be on its mind, with a special focus on Europe, with 80% of the installed capacity in OECD member countries.

"To achieve our targets, we will continue to develop our own energy projects to sign long-term power purchase agreements with high-quality partners and to hold these assets over the long term. We also plan to selectively sell assets to help fund our strong growth," said Neoen's Chairman and CEO Xavier Barbao.

Financial results

Earlier the group had reported its annual results for 2020 having increased revenues by 18%, and EBITDA by 25%, even as its net income declined 89% compared to 2019. Solar revenues grew 20% on annual basis thanks mainly to assets commissioned in El Salvador and Mexico.

Going forward, Neoen forecasts EBITDA of between €295 million and €325 million in 2021, and targets an annual increase of more than 20% in 2022, followed by double-digit annual growth over the 2023-25 period.

In a related news about the company, local media reports in Australia claim Neoen's Goyder South 1.2 GW wind, 600 MW solar and 900 MW battery storage project proposed by the company for South Australia, has secured planning approval approval (see Neoen Australia Seeking Approval For Goyder South Project).