I'm sure many investors on here are familiar with Infigen Energy ('IFN'). A renewable energy producer (formerly Babcock & Brown Wind pre 2009) which owns a number of wind farms throughout Australia with a nameplate capacity of around 556MW. Farms are located in WA and east coast. The company is a survivor of the spectacular collapse of the Babcock group of companies during the credit crisis. As with such companies at the time, they were highly leveraged and were being charged exorbitant asset management fees by Babcock. Fast forward to today and they have internalized asset management, maintenance and operation and are a profitable energy producer and asset developer. They are still laden with a large chunk of the legacy debt which is slowly being paid down out of earnings (and the odd cap raising).
Anyway, I bring them up as potentially a 'grown-up' version what Carnegie could be. Both are in the renewables space and both focused on the 'build, own, operate' model. Of course the main point of difference is IFN's weapon of choice is wind farms (however they are also branching out into utility scale solar), and CCE has the added advantage of having the technical expertise and reputation to build assets for third parties where IFN only builds in-house. Also CCE has CETO and micro-grid expertise in the back pocket.
Their balance sheet is an example of the type of returns/profitability/margins that an owner of utility scale renewable energy assets can enjoy (however IFN's numbers are slightly spoiled by their sizable interest obligations on their debt). But if you make a comparison on the EBITDA, I think it might give some insight to what kind of revenue we can expect from the Northam Solar farm.
I make the educated assumption that wind and solar generation assets have similar levelised costs of energy (i.e the cost of an installed 1MW of nameplate capacity) . Arguably solar has less maintenance and operating costs but also has a slightly lower capacity factor (actual output over the course of the year)
(If anyone has knowledge in this area would love to hear your take as the point of the comparison is to gauge expected revenue levels from Northam and related projects)
IFN's total nameplate capacity is 556MW, with a capacity factor of 30.5%(disclosed in annual report) which resulted in revenue of $196.7m includes Operating costs of $40.2m, leaving an EBITDA of $156.4m. A margin of 79.5%.
Northam has name plate capacity of 10MW, with an assumed capacity factor of 28%* which would result in revenue of around $3.2m assuming all other things are equal. Assume similar operating costs (I would argue this would be a lot lower for this project) of $700k, you're looking at an EBITDA of $2.5m.
*This article suggests utility scale solar in WA has a capacity factor of 28%:
http://reneweconomy.com.au/large-scale-solar-costs-near-parity-with-wind-energy-in-australia-54829/
CCE has a 50% equity interest so you'd be looking at at least $1.25m added to earnings.
Ok so I've laid this out, I welcome critical assessment. Would love if anyone can add to this rough model.
IFN's financials below for reference:
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