PARIS - The current economic climate is favorable for French wind and solar power company EDF Energies Nouvelles as equipment prices remain low and banks are more prepared to lend, its chief executive said.
It is embarrassing to say that the crisis suits us but it is true that equipment prices have fallen and that banks are still accompanying us, David Corchia told Reuters on Thursday.
Getting financing was now taking just over twice as long as before the economic crisis but there is more appetite coming from banks since June, Corchia said in an interview.
However, I am not looking forward to economic euphoria and easy money restarting too fast, it would not be good news.
EDF EN, 50-percent owned by French utility EDF, said 2009 earnings before interest, taxes, depreciation and amortization (EBITDA) would be in a 280-300 million euros ($416-$446 million) range, up from 216 million in 2008.
Corchia confirmed the company's target to reach 4,000 MW by 2012, including 500 MW of solar power, compared with an installed capacity of 1,796 MW at the end of September.
Corchia said while the economic downturn meant it was a good time to make acquisitions as many wind developers were finding it hard to find financing for their projects, it remained difficult to find profitable acquisitions.
Making acquisitions to have more megawatts does not interest me, Corchia said.
We have to wait for the situation of a company to be critical because when it is not the case there is always another operator prepared to make a bigger cheque than us, he said, adding the company would continue to focus on organic growth.
MIDDLE EAST, EASTERN EUROPE Corchia said while EDF EN would keep developing its business in the United States and western Europe, it was now eyeing the Middle East and eastern Europe.
We have hydropower assets in Bulgaria so we are not ruling doing something there (for wind power), Corchia said.
The company was waiting for authorities to put a regulatory framework in place before building capacity.
We are not in the business of making bets, he said. What we are doing is building a portfolio of sites but we are not obliged to construct fast, he said.
A possible new zone for solar power was the Middle East.
There is a huge potential and a strong will to do renewable energy because those countries would rather keep their oil reserves as long as possible, Corchia said.
But again there was a need for a regulatory framework in those countries before being able to move ahead.
We do not yet have contacts and negotiations under way but we are working on the right angle to propose for a lasting development and not just for one project, he said.
France, which makes up around 15 percent of EDF EN's activity, was proving disappointing because of a slowdown in granting of building permits for wind power.
France has vowed to build 20,000 MW in terrestrial wind power by 2020, a target some say will not be met because of growing political opposition.
There is in France a number of politicians who are against wind power. At this current rhythm we will not install the 20,000 MW necessary to reach the 23 percent of renewable energy target, he said.
Numerous changes in the regulatory framework were also to blame. Government plans to abolish the professional tax (a tax paid by businesses to local authorities), which constitutes the main incentive for towns to welcome wind power farms, would be the final blow to the industry, he said.
(Reporting by Muriel Boselli; Editing by Dan Lalor)
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