Canadian asset manager Brookfield will be required to divest French IPP Neoen’s operational assets and six development projects in Victoria, Australia, which include the 350MW/450MWh Victorian Big Battery.
The Australian Competition and Consumer Commission (ACCC) released a statement today (31 October) stating that the acquisition of Neoen would increase Brookfield’s chances of prioritising its own generation and storage assets. This concludes an investigation focused on competition in Victoria’s markets for renewable energy supply.
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Indeed, Brookfield already holds a controlling interest in AusNet, which owns and operates most of Victoria’s electricity transmission network and parts of the electricity distribution network.
Should the acquisition go ahead without the divestment, regulator ACCC said it could lead Brookfield to hold a “monopoly” over energy network assets in the Australian state.
ACCC said it would not oppose the takeover if Brookfield divested the assets.
“The ACCC has long-standing competition concerns with cross-ownership of monopoly energy network assets and energy generators due to the potential for the monopoly provider to discriminate against rivals and favour its own operations,” ACCC commissioner Dr Philip Williams said.
“The ACCC considers that, without the divestment, the acquisition would have increased Brookfield’s incentives to delay or increase the cost of connections works on rival projects or operate the AusNet transmission network to benefit Brookfield’s related assets.”
Dr Williams added that the ACCC has accepted Brookfield’s court-enforceable undertaking to divest Neoen’s operating assets and development projects in Victoria.
Under these terms, Brookfield must divest Neon’s operational assets and six development projects in Victoria. The operational assets are the Victorian Big Battery, the 250MW Numurkah Solar Farm, once the state’s largest solar PV power plant, and the Bulgana Green Power Hub, which includes a 20MW/34MWh battery energy storage system.
One of the six development projects Neoen will also be required to divest is the second stage of the Victorian Big Battery, called the Moorabool BESS, which intends to add an additional 300MW/450MWh system to the project.
Brookfield also holds a stake in Spanish sustainable energy developer X-Elio, which operates in the Australian solar PV and energy storage market.
Should this divestment be completed, the ACCC said it would “not oppose” the acquisition of Neoen by Brookfield.
Brookfield’s proposed takeover of Neoen
The French independent power producer is set to be acquired by Canadian asset manager Brookfield, in a deal worth €6.1 billion (US$6.7 billion).
The closing of the deal will see Brookfield take a 53.12% majority stake in Neoen at €39.85 (US$42.6) per share from investors Impala and Fonds Stratégique de Participations, an investment vehicle owned by seven French insurance companies, amongst others.
Neoen announced negotiations with Brookfield in late May for a majority sale to the asset owner, along with its institutional partners Brookfield Renewables and Singapore-headquartered investor Temasek.
The French IPP completed the first stage of the 219MW/877MWh Collie BESS in Western Australia earlier this week (29 October). The BESS was installed as part of state-owned Synergy’s wider 500MW/2,000MWh Collie project.
