IKEA does 195 MW Australian solar deal with German developer

Netherlands-based holding company Ingka Group has increased its Australian renewable energy capacity by purchasing three solar farms in regional New South Wales (NSW) from the Australian arm of German PV developer Enerparc in a deal valued at approximately $250 million (USD 168 million).

Enerparc said the portfolio includes two operational solar farms at Trundle and Peak Hill, near Parkes, in central-west New South Wales (NSW), with a cumulative capacity of 13.3 MWp. It also includes a 180 MWp solar project currently under development that Enerparc said is expected to start producing electricity at the end of 2025.

Although not identified, the only project Enerparc has of this scale in Australia is the 152 MW (AC) Tilbuster Solar Farm being developed north of Armidale in northern NSW.

Enerparc established its Australian operations in 2017 and the managing director of Australian operations, Benjamin Hannig, said the company remains “committed to delivering innovative and sustainable energy solutions in Australia and look forward to advancing further projects of our pipeline in the near future.”

“This transaction is a testament to Enerparc Australia’s success in developing and realising solar projects in NSW led by our team of professionals based in Sydney,” he said. “We are excited about accelerating the energy transition with the prospect of further developments and partnerships in Australia.”

Other projects under development by Enerparc Australia include the 25 MW Innes Park Solar Farm in Queensland, 25 MW Tenterfield Solar Farm in NSW, and 12 MW Carag Carag Solar Farm in Victoria.

Enerparc Chief Executive Officer and Chair Christoph Koeppen said the deal with Ingka aligns with the company’s plan to develop a total of 10 GW solar globally for its own portfolio and another 10 GW of third-party solar projects by 2030.

“These and future Australian projects developed by Enerparc Australia will contribute to this strategy,” he said.

The total production of the three solar farms acquired by Ingka will be approximately 340 GWh per year, which is equivalent to the electricity consumption of about 65,000 Australian households.

Ingka said the output of the solar farms will initially be “steered contractually” towards local Ingka Group operations, and in future to value chain partners and customers.

The solar investment, which follows last month’s acquisition of a 15% stake in stage one of TagEnergy’s planned 756 MW Golden Plains Wind Farm near Geelong in Victoria, is part of Ingka’s global clean energy strategy and its push to becoming a 100% renewable energy organisation by 2025.

Ikea Australia Chief Executive Officer and Chief Sustainability Officer Mirja Viinanen said the new investment in solar would better diversify the company’s renewable portfolio and better match production with consumption.

“In addition to the recently acquired stake in a wind farm in Victoria, this is the next vital step towards reaching 100% renewable energy across all operations,” she said. “We have ambitious targets when it comes to reducing our climate footprint across Ingka Group globally, and meaningful investment like this is leading the way.”

Ingka has committed to invest $10.55 billion (EUR 6.5 billion) in renewable energy projects with the aim of reducing more greenhouse gas emissions across its value chain by 2030. It has already invested more than $4.85 billion in wind and solar projects globally and Ingka Investments Managing Director Peter van der Poel said Australia has been identified as a location with rich potential for renewable investments.

This is the “next step in accelerating our energy production in the Asia and Pacific region,” he said. “With our own solar parks and wind farms, we want to make renewable energy available throughout the IKEA value chain and beyond.”