Mainstream Renewable Power, the Dublin-based green energy developer, and Spain’s Ocean Winds have secured grid connection for a 1.1 gigawatt (GW) floating wind farm they are developing off the coast of South Korea.
The development comes as Mainstream, which was taken over by Oslo-listed Aker Horizons three years ago, eyes opportunities to take money off the table on certain projects to recycle it into other developments as it continues to recover from a period of large losses racked up in Chile.
A spokesman for Mainstream declined to say if the company plans to sell down its 33.3 per cent stake in the joint venture when the project – known as KF Wind – reaches financial close, a crucial stage when all the financial arrangements and commitments around an infrastructure development are finalised. The total 1.1GW size of the development equates to a fifth of peak electricity demand in the Irish market.
It is believed the project still has to reach other key stages before that is reached.
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“This agreement marks a very important milestone in the development of KF Wind and a major step forward towards getting the project ready for construction,” said Austin Park, project director of KF Wind, which is being developed in two phases about 80km off the southeast coast of South Korea.
Mainstream, which was set up in 2008 by the late green energy entrepreneur Eddie O’Connor, inherited the development when Aker Horizons rolled its existing wind energy business, Aker Offshore Wind, into its Dublin-based unit two years ago.
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Aker Horizon’s 58 per cent stake in Mainstream accounts for more than two-thirds of the group’s assets. That follows Aker Horizon’s previously 43 per cent-owned Aker Carbon Capture, which has the technology to capture and store carbon dioxide from industrial operations, selling 80 per cent of itself in June to oilfield services giant SLB, formerly known as Schlumberger.
Shares in Aker Horizons have slumped by more than 90 per cent since the start of 2022. That covers a period in which Mainstream has booked the equivalent of about €870 million of writedowns against Chilean assets – known as the Andes Renovables onshore wind and solar platform – due to various problems in that market.
The wider green energy sector has been under pressure over the same period – with the S&P Global Clean Energy Index sliding by more than a third – as the capital-intensive sector struggles with heightened interest rates and a hangover from when green energy stocks were in high demand during the pandemic.
Mainstream managed to restructure more than €1.1 billion of Andes Renovables debt last year – stabilising the business. Andes Renovables, which has 1GW of fully operational energy capacity in place, has delivered a positive gross profit margin in each of the four quarters to the end of June.
Aker Horizon bought into Mainstream in 2021. Legacy Mainstream shareholders, including the estate of Mr O’Connor and Irish high-net-worth individuals, continue to own 16.5 per cent of the Dublin-based unit. Japan’s Mitsui owns 25.5 per cent.
Meanwhile, Mainstream reached financial close last week on a 50MW solar plant which will provide flexible power purchase agreements to companies in South Africa.
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