EDP Plans 18% Increase in Capacity With New Wind Farms, Dams

EDP-Energias de Portugal SA, the country’s biggest utility, plans to increase installed capacity by 18 percent through 2017 as it adds wind farms in the U.S. and completes hydropower plants in its domestic market.

The weight of hydropower and wind energy will increase to 75 percent of the estimated installed capacity of 26.7 gigawatts in 2017 from 68 percent in 2013, Lisbon-based EDP said in a presentation today. Renewable-energy unit EDP Renovaveis plans to add 500 megawatts of capacity a year through 2017, mostly in the U.S., and may sell minority stakes in some wind farms.

The former Portuguese power monopoly is spending on new dams and wind turbines as it relies less on oil and coal and taps state incentives for alternative energy. About 40 percent of the accumulated investment for 2014 to 2017 will be carried out by the EDP Renovaveis unit.

EDP reaffirmed a forecast for investment of 1.7 billion euros ($2.3 billion) in 2014 and 1.5 billion euros in 2015. Annual average investment will drop to about 1.2 billion euros in 2016-2017 from an average of 1.6 billion euros a year in 2014-2015.

The utility also reaffirmed a forecast for earnings before interest, tax, depreciation and amortization of about 3.5 billion euros in 2014. It estimates net profit of about 900 million euros for this year. EDP targets a compound annual growth rate of about 5 percent for both Ebitda and net profit in the 2014-2017 period.

EDP shares fell 3 percent to 3.383 euros at 12:43 p.m. in Lisbon. The stock has climbed 27 percent this year, giving EDP a market value of 12.4 billion euros. China Three Gorges Corp. is EDP’s biggest shareholder, with a 21 percent stake.

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