A 250% surge in the price of power has delivered a cash boost to Parkmead Group (LON: PMG) at its wind farm in Aberdeenshire.
The company acquired Kempstone wind farm near Stonehaven for £3.3m in February, which generated revenues of £400,000 for the financial year ending September 30, 2021.
Parkmead said the Aberdeenshire wind farm had its annual power purchase agreement renegotiated in August, which has seen the wholesale export electricity prices surge by “nearly 250%”.
The company said this has delivered a “significant boost in near term cashflow” but has not given estimated revenues from the project.
Shares in London-listed Parkmead are up 10% this morning to 59 pence.
Executive chairman Tom Cross said: “The Kempstone Hill Wind Farm acquisition has been complementary to our earlier stage, high-upside renewable energy projects, which we are now progressing at pace. We are delighted by the contribution made to date by Kempstone Hill to the Group, especially considering the significant upside arising from the increases in wholesale electricity prices seen in the last 12 months.
“The Parkmead team continues to assess all opportunities to expand our Renewable Energy division, both organically and through acquisition.”
Windfall tax
Similarly to oil and gas, there has been talk of the government extending the windfall tax to renewable energy firms, as they too have enjoyed windfall profits as power prices surge.
However, the industry said it could harm investor confidence and dent the government’s wider energy strategy.
Former PM Boris Johnson said in July there is no such plan to do so.
More options
Parkmead said Kempstone is now fully integrated into the group and has, in the last 12 months, generated 2,850 megawatt-hours of electricity with a 99.7% availability, enough to power 1,000 homes.
The company said it is assessing “a number of opportunities” to enhance the development, such as the potential inclusion of solar power generation and expanding sales of electricity to local industrial users.
Recommended for you
