Irish green energy industry veteran Andy Kinsella is an early morning kinda guy.
“I get up at 5.30am and am out on my bike by a quarter to six. If it ain’t lashing rain and windy, I’ll get out five mornings a week,” says Kinsella.
His daily, 20km cycle takes him from his home in Fairview in north Dublin out the coastal road to Sutton and back, before heading into work at Aer Soléir, the European renewable power development company he runs from the city’s south docklands. He likes to be at his desk an hour before the 8.30am start of the office day.
“I’ve always loved coming into work early,” the 62-year-old says. “It’s nice to have time to clear the desk and get ready for the day.”
Kinsella, who worked for three stints with ESB and led the late green energy entrepreneur Eddie O’Connor’s Mainstream Renewable Power before its sale to Norway’s Aker Horizons in 2021, set up a European wind and solar venture Aer Soléir four years ago with Manus O’Donnell, a fellow renewables executive, with financial backing from Texas-based Quantum Energy Partners.
Aer Soléir has accumulated a pipeline of about three gigawatts (GW) of wind, solar and battery storage projects in Europe, the equivalent of half of peak electricity demand in the Republic. Some 360 megawatts (MW) of wind farms are currently under construction in Greece; the rest is in various stages of development across Italy, Spain, Portugal, Greece and Ireland.
On the block
Aer Soléir – Irish for clean air – is also known to be currently up for sale, with Rothschild managing the task.
“We’ve been testing the market to see what interest there might be in the company. It’s an ongoing process,” is all Kinsella will offer on that.
A sale was first mooted in July 2023. However, the sector has been out of sorts for much of the time since then – with the S&P Global Clean Energy Transition stocks index sliding close to 40 per cent in the 18 months to the end of last year – as the capital-intensive sector struggles with spikes in interest rates and prices for wind turbines to civil contractors.
The industry has also endured a hangover from when green energy stocks were on turbocharge during the pandemic.
The index has rallied about 10 per cent this year, helped by falling interest rates and relief that governments across Europe, Aer Soléir’s focus, have doubled down on clean power even if the Trump administration is moving in the opposite direction.
“The US is taking a different route, with a ‘drill-baby-drill’ agenda. Trump’s executive orders have already put about €300 billion of climate change funding at risk,” says Kinsella. “But Europe has very much maintained its commitment to renewables and the clean energy trilemma; affordability, sustainability and security – especially as a result of the Ukraine war where energy is now a security issue in Europe, with a capital S.”
It follows a period when the business model for renewables has been severely tested.
“We saw in the last few years a lack of resilience in the renewables business model, because the margins are not huge and the industry had to deal with a surge in capital costs on one hand and the cost of debt on the other,” says Kinsella.
The company’s most advanced project, an almost 300MW wind project in northern Greece, called Vermio, offers an example.
“We had to delay financial close on that because of how the capital and debt costs went up,” he said. Financial close is the point where all the financing agreements and other commitments on a project are in place, ahead of construction.
However, the Greek government’s move to pass legislation to support the industry enabled it to meet financial close and, subsequently, reach a deal late last year for Amazon to buy the power generated by Vermio and two other Greek projects for 15 years. The contract is estimated by industry sources to be worth more than €1 billion in revenues over its lifetime.
“The industry in general is one where a lot of people are still struggling from the cost of debt and capital costs,” says Kinsella. “But we’ve weathered this really well and are coming out strongly from it.”
In order for the EU to deliver on its commitment to net-zero carbon emissions by 2050, trillions of euro will need to be spent on onshore wind, offshore wind and solar energy.
“We also need to invest €2 trillion in transmission infrastructure across Europe,” says Kinsella.
MILK ROUND
Kinsella, an electrical engineer by background, received two milk-round job offers on the same day in 1985 before he sat his final exams at University College Dublin (UCD) with ESB’s power generation business and US conglomerate General Electric (GE). He opted for the former.
“The ESB was great. But I remember looking around, about 18 months or so in, at guys who had been there for 30 or 40 years and saying to myself, ‘I can’t do that’.
“I tracked down the guy in GE who’d interviewed me. This was long before emails and mobile phones. When I finally got hold of him on the phone, I asked him if he remembered me. ‘Remember you?’ he said. ‘You’re the only guy in the last five years to turn down a job from me’.”
The Arklow, Co Wicklow native would join GE, operating out of Schenectady, in upstate New York in 1988 and found himself involved in large-scale capital power generation projects in North America, Europe, the Middle East, Africa and Asia for the next six years.
A fear of becoming hooked on the tax-free lifestyle of the nomadic project manager prompted him to reassess his future in 1994 and decide to return to Ireland to study for a masters in business administration (MBA).
However, he got a call when back in Dublin from a senior figure in ESB International, the global consultancy arm of the State power group, and was persuaded to join the team. He would sign up to ESB for a third time in 2003 – after a three-year stint after the turn of the millennium as an executive with Siemens Ireland – as an executive director of ESB International, before taking on a managerial role in ESB’s power generation business.
In January 2008, Kinsella got a call from Eddie O’Connor, who was plotting his next move as Airtricity, the wind energy group he’d founded in 1999, was being sold to SSE in a €1.8 billion deal. The two knew each other well, as ESB International had built Airtricity’s first three wind farms under contract.
Kinsella was the first person O’Connor hired for his next venture, Mainstream Renewable Power.
“It had taken 12 years or so for Airtricity to go from a standing start to sale. And the view in early 2008 was that it was not going to take that long with Mainstream, given the knowledge and scars that had been built up. Then, of course, we had Lehmans, which changed everything,” he said, referring to the implosion of the Wall Street investment banking giant in September 2008 and the global financial crisis that followed.
The problem for Mainstream at the time was that it was an early-stage development business.
“While we were well funded for the first two to three years, it would be very difficult to raise capital over the next seven, eight, nine years,” Kinsella said. “During that time, we really had to fund the business by selling assets much sooner than we would have liked.”
Kinsella recalls four occasions when Mainstream faced running out of cash within months. “We had to get creative on how we would bridge through those periods. They were nervous times for everybody,” he said.
The big breakthrough was the sale of the company’s Neart na Gaoithe 450MW wind farm project off the coast of Scotland to Électricité de France (EDF) in 2018. Luckily for Mainstream, the value of the project had risen sharply in the years before the deal at a time when the project was caught up in a legal battle, waged and ultimately lost, by an arm of the Royal Society for the Protection of Birds (RSPB).
Some 17 years after Mainstream won the originally bidding process, Neart na Gaoithe is an example of how drawn out these projects all-too-often are. EDF and the partner it brought on board, Kinsella’s old employer ESB, have stomached hundreds of millions of euro of writedowns on the development in recent years as it faced all kinds of delays. It only started producing power last October. Its last turbine was installed in early April.
Kinsella succeeded O’Connor as chief executive of Mainstream in September 2018, as his boss stepped into the role of executive chairman.
But he surprised industry followers by quitting the company in August 2020 as it was in the middle of a sales process. The reason, Kinsella insists, was simple. “We were getting to best and final offers at that stage and I wanted to do something else after 12 years. I didn’t want to be in a position where I could have been tempted by the buyer to stay,” Kinsella says of the departure.
He lodged a lawsuit against the company in the High Court weeks after his departure. The case was settled six months later, shortly before Aker Horizons completed its €900 million purchase of Mainstream. Kinsella refuses to comment on the matter, citing a non-disclosure agreement.
Quantum leap
Quantum executives were among a raft of investment firms that contacted Kinsella within days of leaving Mainstream. The US group’s green energy unit 547 Energy would commit $250 million (€222.6 million) of equity funding to Aer Soléir.
Kinsella declines to comment on the shareholder breakdown of the business’s Cyprus-based ultimate holding company but private equity-backed start-ups typically have incentive arrangements for management and staff equivalent to stakes of 15-30 per cent. Aer Soléir has 34 staff.
Mainstream, meanwhile, and its Oslo-listed owner, Aker Horizons, have been through a torrid time in recent years. The Irish company has taken as much as about €890 million of impairment charges against its main producing assets in Chile since the start of 2022, amid significant challenges in that market. Its chief executive, Mary Quaney, stepped down in April as the company went about closing its Dublin headquarters and moving its base to Norway. Quaney remains a senior adviser at the business, but is set to leave later this year.
Mainstream has streamlined its business to focus on growth in core markets South Africa, Australia and the Philippines, as well as certain offshore projects.
Aside from the 360MW of Greek projects under construction, Aer Soléir has 500MW at late development stage, and 900MW at what it calls mid-stage. The remaining 1.3GW is at an early stage.
Its Irish interests include a 75MW solar project in Roscommon that is expected to go into construction in 2026 and a similar development, amounting to 84MW, in Carlow where construction should start in 2027. Both were among the winners of the State’s fourth Renewable Energy Support Scheme (RESS) auction last autumn.
Successful bidders in these auctions receive a guaranteed price for their electricity, which helps secure financing for development. These are called offtake agreements.
The new Programme for Government commits to delivering 9GW of onshore wind, 8GW of solar and at least 5GW of offshore wind by 2030 and promises to hold at least one RESS auction a year “to ensure that Ireland continues to bring renewable energy projects on stream at a fast pace”.
The wind energy sector received a boost earlier this year when the High Court ruled that An Bord Pleanála had failed, in previously blocking a 13-turbine wind farm project in Co Laois, to prioritise the “overriding public interest” of the development balancing legal interests. This priority was enshrined in 2022 EU regulations aimed at accelerating renewables.
But scepticism about Government targets is widespread across the energy industry.
“The planning process is still too slow,” says Kinsella, who estimates that it is currently taking about seven years to develop an onshore wind farm in Ireland, with construction only accounting for a year of that.
The second big impediment – in Ireland and across Europe – is ongoing electricity grid capacity constraints. “When I started off in the renewables business 25-30 years ago with ESB International, the Holy Grail was securing an offtake agreement,” he says. “The Holy Grail now is getting grid capacity. There’s no transition without transmission.”
CV
Name: Andy Kinsella.
Position: CEO of Aer Soléir.
Age: 62.
Family: Lives with wife Angela in Fairview, Dublin; they also have a place on Drumcoura Lough in south Co Leitrim, where they like to spend weekends.
Hobbies: Anything outdoors involving hiking, biking, running or kayaking.
Something you might expect: “I’ve kayaked the Shannon from the top of Lough Allen to Killaloe ... over 250km.”
Something that might surprise: “We have an 80-tree native Irish breed apple orchard in Leitrim that we grew from 80 tiny saplings – everything from Bloody Butcher to the Widow’s Friend – that produces 2,500 apples in a good year.”
