Huge utility shrinks with $264 million sale of wind operation

Iberdrola, one of the world's largest utilities, is getting smaller.

The Spanish company has agreed to sell its Polish wind operations to Poland's biggest power producer, PGE, for 840 million zloty, ($260 million), Bloomberg reported earlier this week.

Iberdrola is the world's fifth largest electric utility with a 2012 market value of $36 billion, according to Statista. It has expansive operations in Europe, Latin American and North America across an array of power sources including natural gas, wind, nuclear, hydro, coal and others, although little in solar (chairman Ignacio Galan has been highly critical of one type of solar power plant).

Its proposals include a nuclear power plant in the U.K., where it owns Scottish Power, one of Britain's "Big 6" utility companies.

Last October it said it would divest €2 billion ($2.6 billion) in "non-core assets and in non-core countries" as part of a debt reduction plan. The Polish sale falls within that plan, which will also include the sale of wind assets in France and Germany.

PGE is buying wind farms with a capacity of between 70.5 megawatts and 114 megawatts, two different filings show. That's less than a tenth of an average nuclear reactor, or around a tenth of a large coal station.

The state-owned company supplies 42 percent of Poland's electricity, according to the World Nuclear Association (WNA). It relies heavily on coal as do other Polish power producers. Poland has Europe's largest coal reserves, and coal accounted for 86.5 of the country's electricity in 2011 (some reports put coal's share at well over 90 percent).

Poland is trying to slash coal power in order to shrink CO2 emissions, and PGE itself is investing 330 billion zloty ($102 billion) through 2035 to add capacity and diversify its power sources to low carbon production including nuclear, WNA says. PGE targets a 14 percent renewables share by 2035, and 36 percent for nuclear.

Photo from Iberdrola

More Iberdrola on SmartPlanet:

• Public lands and renewable energy: 25 projects and counting
• Solar v Solar: Gloves come off at G20 Summit
• Outlook dim for solar panel manufacturers

Some recent SmartPlanet reports on wind, nuclear and coal:

• Nuclear: Less CO2 than solar, hydro, biomass
• Wind farms blow past record in 2012
• World Bank boss urges coal for poor countries

This post was originally published on Smartplanet.com