Growing renewables
Towards 2027 we will continue to grow our renewables capacity, targeting NOK 500-750 million in annual gross equity investments. Solar PV, wind and battery storage will make up the largest share of our investments due to its complementary profiles and attractive fundamentals. We will utilise our competitive integrated business model and stay committed to delivering attractive returns of 1.2 times the cost of equity, D&C gross margins of 8-10% and O&M margins of 25-30%.
We aim to build stronger and longer-term positions in selected emerging markets, where we see a clear green agenda and potential to build scale and apply our proven model. We are ramping up growth in South Africa, Egypt, Brazil and the Philippines where we have a strong track record and operational portfolios, while we are building positions in India and Poland. Beyond these focus markets, we will maintain our opportunistic approach, applying strict guidelines on potential projects in terms of size and value creation.
Scatec will further grow selectively in green hydrogen and hydropower. Our green hydrogen efforts are focused on Egypt where we have secured projects with excellent renewable energy resources and export hubs to Europe. Within hydropower, Scatec’s JVs with Aboitiz in the Philippines and Norfund and BII in Hydro Africa are exploring attractive growth opportunities.
Optimising the portfolio
We further seek to optimise our portfolio through capital recycling. Our capital recycling rationale is to re-invest capital into new value creating projects and also seek to reduce debt on corporate level over time. We will exit selected non-core markets to consolidate the portfolio as illustrated by Scatec’s recent divestments of Mozambique, Rwanda, and Argentina. We might also realise selective divestments or farm-downs in our focus markets if it is value creative and does not harm our strategic position, exemplified by the sale of Upington in South Africa.
