China Buys U.S. Wind Energy
State Grid of China Wants U.S. Wind Power Business
China’s State Grid Corp is buying up international assets—and AES Corp (NYSE: AES) may be its way into the United States.
State Grid has already purchased a stake in the Portuguese REN (ELI: RENE) and began operating a Philippine power grid several years ago.
And Chinese energy companies attempted to move into the U.S. in 2005 when CNOOC launched a failed bid for Unocal, a Californian oil company.
This deal with AES could be one of China’s first forays into U.S. energy and open up the opportunity for other Chinese companies to do so.
State Grid is interested in AES’s wind power sector, AES Wind Generation. The company operates 1,800MW in wind power, most of which is located in the U.S.
State Grid is looking for nearly 80% of this, or 1,100MW. Details have not been released, but analysts say the power capacity could be worth up to $1.65 billion.
Shi Pengfei, vice president of the Chinese Wind Energy Association, told Reuters:
“Because domestic electricity prices are controlled by the government, expanding overseas could help power companies’ profits.”
AES Corp has neither confirmed nor denied the information regarding this deal, but State Corp president Liu Zhenya visited the U.S. in early February as part of a delegation.
It is uncertain whether the deal is still in the discussion stage or has reached the agreement stage. But information will likely be released soon.
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