EDP and EDP Renewables are the world’s second-largest generator of wind energy in terms of market capitalization and the third-largest wind energy producer in the USA. The new investment will create thousands of jobs to develop, build and operate the wind energy projects, as well as to manufacture the turbines to be installed.
So far in 2009, EDP Renewables has already installed or has under construction a total of 800 MW of wind farms, worth US$1.5bn. Company officials credit the US commitment to a clean energy economy as key reason for the private investment.
“EDP Renewables is serious about partnering with the United States for a number of reasons but, most of all, because of the leadership we have seen from the federal government,” says Antonio Mexia, CEO of EDP and chairman of EDP Renewables. “The Obama Administration and Congress signalled that they are serious about fostering production of renewable energy and that has assured us that America is the right place to invest.”
In the United States, EDP Renewables operates 2.5 GW of wind capacity in 21 states and, in the past three years, its US operations have grown from 60 employees to 300. Its rapid growth this year is largely due to the implementation by the Department of Treasury and Department of Energy’s 1603 Program that provided a regulatory framework to accelerate construction of new renewable energy capacity.
The 1603 Program allows renewable energy producers to offset the costs of new projects with a 30% grant. Companies which use the programme agree to give up certain future tax credits for which they would have been eligible, and the direct payment has spurred development by companies that did not have a federal tax liability and encouraged immediate re-investment of renewable energy profits.
“This innovative programme provides companies with the resources needed to increase investments in renewable energy production, allowing the nation to establish a clean, domestic energy industry that creates jobs and revitalises our economy,” says treasury secretary Tim Geithner.
The announcement was made one day before Horizon Wind Energy, an EDP Renewables company, dedicated the first phase of its 200 MW Meadow Lake Wind Farm in Indiana, worth US$400m. The second phase started construction in early September and was accelerated due to 1603 funding the company received from a previous project.
With 20 wind farms across the United States, Horizon Wind Energy has developed 3.4 GW and operates 2.5 GW of wind farms. It is owned by EDP Renováveis S.A., whose installed capacity increased four-fold between 2005 and 2007.
“EDP is committed to reinvesting all funding received from the 1603 Program into new renewable energy projects and jobs in the United States,” says Mexia. “However, more needs to be done; the next step is to enact an aggressive Renewable Electricity Standard (RES) that will ensure more companies like EDP can make longer term investments in this sector.”
“An RES is essential to creating a framework that will create sustainable growth in the wind energy sector throughout the country,” he adds. “With a strong RES in place, the United States can continue to lead the world's new energy economy, keep and create jobs and investment here, develop technology leadership in a business with a solid future and demonstrate a tangible commitment to solving global climate change.”
Energias de Portugal, S.A., the parent company of EDP Renewables, is a vertically-integrated utility company, headquartered in Lisbon, Portugal. It holds electricity and gas operations in Europe, Brazil and the USA.