EDP announced that it has agreed a multi-billion euro deal to sell six hydro power plants in the Douro river basin, to a consortium led by France's Engie, as per the official sources.
The deal is expected to grow EDP's coffers as it faces a hit to profits from the Portugal's move to greener energy, the sources confirm.
Portugal was the first country to commit to carbon neutrality by 2050 and has said all coal plants must be closed in coming three years, as per the available data. This, along with factors such as lower gas prices, will take 300 million euros off EDP's reported net profit this year and 200 million euros in 2020, as per the company announcement.
The company officials declared that, "The acceleration of the energy transition process over the past year led to a material deterioration of the operating outlook for coal plants in the Iberian market."
2.2 billion euros hydro plants deal is expected to be completed by the second half of the coming year, as per the statement of EDP. The consortium includes Engie with a 40% stake, Credit Agricole Assurances and Mirova-Natixis Group.
"This transaction aims to optimise our portfolio, decreasing our exposure to concentrated hydro volatility and merchant prices, reinforcing the low business risk profile and improving financial leverage," EDP announced in a statement.
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