TotalEnergies VSB Acquisition, Naturgy $2.3B for AUS Market

Naturgy has secured $2.3 billion in financing to boost its Australian portfolio, MARA Holdings will acquire a wind farm in Texas, and TotalEnergies which will acquire VSB Group for €2 billion.

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Welcome to Uptime News Flash. Industry news, lightning fast. Your hosts, Allen Hall, Joel Saxum, and Phil Totaro, discuss the latest deals, mergers, and alliances that will shape the future of wind power. News Flash is brought to you by Intel Store. For market intelligence that generates revenue, visit www.intelstor.com.

Allen Hall: Big news this week, Naturgy has secured 2. 3 billion Australian dollars in financing to boost its Australian renewable portfolio. The financing operation has been formalized with 11 international banks. Global Power Generation, which is a subsidiary of Naturgy. Closes 2024 with a portfolio of one gigawatts of projects in operation.

Now, Phil, a lot of things are happening on Australia on their noble energy front, and particularly in wind at the moment.

Philip Totaro: This is another one. Well, and this is an important one for GPG because they’re trying to build three projects right now two wind farms, the Ryan Corner and the Crookwell Three projects, and then also a, a hybrid project called the Cunderdin.

Hybrid plant that’s gonna include some solar PV so they’re immediately going to be deploying this 2. 3 billion Australian dollars and, and put it to good use, building a significant amount of, of new capacity. So, good on them.

Allen Hall: For you Bitcoin lovers, Marathon Digital Holdings will acquire a wind farm in Hansford County, Texas with 240 megawatts of interconnection capacity.

Now the site includes 114 megawatts of operational wind currently and Marathon Digital Holdings will develop a behind the meter data center power Buy wind energy. And this allows them to do Bitcoin mining, Phil.

Philip Totaro: Yeah, this is actually the first of its kind in terms of this type of a deal structure where a, a Bitcoin miner specifically, I mean, there’s other companies like Amazon that have bought into wind farms or, or co developed and built wind farms.

And agreed to take the power and feed it into their, their data centers but this is the first time, as you just mentioned, that they’re going to do a behind the meter data center where they can avoid So yeah. And agreed. Agreed. A lot of the issues you get in, in ERCOT and in Texas in general, where you’ve got, periods of negative pricing or what have you, where you’ve got to dump a lot of power.

They’re at least taking the power that they would otherwise dump and putting it into their, their Bitcoin mining operations, which, is, is increasingly power intensive. I, I remember setting up a small Bitcoin mining operation on my laptop about ten years ago. I ended up getting about 80 bucks.

So that’s, that’s the best I could do. These guys are going to be doing, a lot more with a lot more power.

Joel Saxum: But I think you’ll see a lot more of this happening in specifically, like Phil said, in the Texas, in the ERCOT market down here, because it’s a triage market. When you look at it, you can see negative prices, positive price.

You have a bad winter storm or some things come offline. All of a sudden power is 3, hour in a wholesale market. Like you see a lot of changes. So I’ve talked with over the few years that I’ve been involved in wind. Quite a few people down here that are looking at different behind the meter options.

So of course this, blockchain data processing is one of them. Another one is hot green hydrogen behind the meter. So if you have the ability to flick on and flick off power directing it to the grid when it makes sense for money or back to an operation that makes sense for money, that’s a huge thing.

And when you have a lot of distressed assets, which there is in Texas and from that early wind game that old, those are seven, nine, 10, 11, 12, even 13. Some of these assets are floating around that haven’t been maintained that well, or, they’re at the end of their kind of useful life. They need a little bit of capital injection to get them up and running.

They can be bought for a decent price and they have interconnects with the grid as well. So, I think if you dig into the weeds of the wind industry, you’ll see some more of this starting to happen.

Allen Hall: And another big acquisition with Total Energies, which will acquire VSB Group for 2 billion euros.

Now, VSB Group has about 10 gigawatts of renewable pipeline across 10 European countries, and this acquisition by Total is part of their 100 gigawatts capacity by 2030 initiative. This gets me a long way, Phil. 10 gigawatts is a substantial acquisition.

Philip Totaro: It does, although one could also contend that if they just kept investing in offshore wind, they’d get there a little faster.

But this is kind of the reality, right? This is why they’re doing this deal at this point is the, the inflation and interest rate environment Totaro is such that they want to pull money out of offshore wind and, but they’ve got to do something with it. Total being one of the, oil and gas and utility companies that’s actually probably one of the more committed, along with RWE and Vattenfall Statcraft as well.

Committed to, to renewables. So the fact that they are going to park their money in, in somebody that’s doing a lot of onshore wind and even solar and some storage development like VSB Group has throughout Europe is fantastic and, and this should go a long way to, to helping both VSB get more access to capital and help Total go a long way to getting.

Their, their kind of internal goals met as far as their their energy targets and, and ESG targets.

Joel Saxum: For those people that are interested in business risk, like I am, I think it’s, I think it’s a really interesting concept. You look at what Total Energies has done in the last few years.

They had Total E Ren, so basically they funded a group. Like them with under the total name, but it wasn’t completely absorbed into total energies and just to see how the renewable energy Play would play out and they did very well So they said you know what total iran you are going to become part of total energies and now it’s one big group and then And now again looking at the risk profiles, and just today we’ve seen some really tumultuous news come out of the french government which may have some implications on what happens to renewable energies and Yeah, whether it’s subsidies or other things that happen over in that country, Total Energy’s being a French company, making all of a sudden this big move into renewable energy.

So it’s a very interesting play. But I think like Phil said, they’re committed to a renewable energy future and fulfilling the goals that they want to. And they’re moving forward on it.