Gamesa and Iberdrola sign the biggest wind turbine supply deal in history

The deal includes the assembling and entry into operation of the turbines, so as their operation and maintenance during the guarantee period. The capacity installed will represent 80% of Gamesa's annual output in 2008. The turbines will be G5x, with a power of 850 kW each, and G8x, with 2 MW each.

The contracts biggest doubt is the split of the turbines among the 4 geographical regions chosen. None of the companies has released any information in this sense. However, Iberdrola has highlighted its international deals closed in 2006, including the acquisition of Community Energy in America (PA), where Gamesa Eólica has recently opened four wind turbine manufacturing plants. Besides, the utility has highlighted also its acquisition of Perfect Wind, a French company with 600 MW in its portfolio, so as the opening of offices in Birmingham (UK), Rennes and Paris (France), Rome (Italy), Berlin (Germany), Warsow (Poland) and United States, which add up to the offices that the firm previously had in Greece, Portugal, Mexico and Brazil.

"The contract development will make possible the implementation of a new production system based on the capacity reserve, planning and synchronized production with the customer, together with a new assembling and maintenace contract", said Gamesa in a press release. "These factors are essential for Gamesa's business plan in order to ensure a profitable and sustainable growth for the company"

Also, Iberdrola's agreement to purchase 1 GW of windparks in America will carry both companies' previous agreement accross the Atlantic.

This deal also includes Iberdrola's acquisition of wind facilities amounting to 500 MW which Gamesa Energía, a windpark developer subsidiary to Gamesa, will put into operation before the end of 2009. "From them, 300 MW are already fixed, while the remaining 200 MW would be subject to a purchase right", Gamesa said. The additional 500 MW belong to the acquisition of ongoing promotions. The financial value of the deal would vary according to some variables, however it has been estimated in the $700m to $1.1b range. The figure depends on what percentage of the installed capacity is actually sold.

Both the turbine deal and the agreement for the windpark sale represent one step further in the level of collaboration of both companies, which started in 2002, when Iberdrola signed an agreement to purchase almost 1,000 MW of wind capacity from Gamesa Energía. In 2005, Iberdrola got 700 more MW promoted by Gamesa Energía in Spain and Italy. In 2004, a similar agreement totalling 250 MW had been sealed in Portugal.

For additional information:
www.gamesa.es
www.iberdrola.es