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EDP Renováveis: How a Portuguese Utility Spinoff Became the World's Fourth-Largest Wind Energy Producer
I. Introduction & Episode Roadmap
In the fading light of a Lisbon afternoon in December 2011, Portuguese government officials finalized a transaction that would reshape their nation's largest company—and, inadvertently, set the stage for one of the most consequential corporate dramas in European energy history. China Three Gorges Corporation, a state-owned enterprise, won the bidding for the Portuguese government's 21.35% interest in Energias de Portugal. It was the first major privatization linked to Portugal's sovereign debt bailout, a fire sale born of fiscal crisis.
What the Chinese hadn't fully appreciated—and what few observers grasped at the time—was that buried within EDP's sprawling empire sat a quiet revolution: a renewable energy subsidiary that had spent the previous five years methodically assembling one of the world's largest portfolios of wind farms, stretching from the coastal plains of Texas to the rolling hills of Poland.
EDP Renováveis is the fourth-largest generator of wind energy globally. That ranking doesn't capture the improbability of the achievement. This is not a company born in Denmark's wind corridors or Germany's engineering powerhouses. It emerged from Portugal—a country of 10 million people, with a GDP smaller than that of Pennsylvania—and transformed itself into a renewable energy colossus spanning four continents.
By the second quarter of 2025, EDPR's installed capacity reached nearly 20 GW, an 18% increase from the prior year. The company operates in dozens of countries, from Brazil to Vietnam, from Scotland to California. EDPR NA serves communities and businesses with more than 11,600 megawatts of reliable, clean energy across the United States, Canada, and Mexico, with wind, solar, and energy storage facilities powering the equivalent of more than 3.2 million homes each year.
The central question isn't whether EDPR succeeded—the numbers speak for themselves. The question is how: How did a corporate carve-out from a debt-laden Portuguese utility become one of the most successful pure-play renewable energy companies in the world? How did it survive the global financial crisis, fend off a $10.9 billion Chinese takeover attempt, and pioneer the financial engineering that would define modern renewable development?
Three themes will recur throughout this story: the prescience of European renewable mandates that forced traditional utilities to adapt; the audacity of the Horizon Wind Energy acquisition that planted EDPR's flag in America's wind heartland; and the quiet genius of the asset rotation model—a capital recycling innovation that freed the company from debt dependency while funding explosive growth.
EDPR reiterated its estimate of EBITDA of close to €1.9Bn in 2025, increasing to around €2.1-2.2Bn in 2026 and to close to €2.2Bn in 2028, mainly supported by strong growth in the US. The company's latest business plan outlines additions of approximately 5 GW in new clean energy capacity between 2026 and 2028, with a projected total of 25 GW by 2028.
This is the story of EDPR—and it begins, as all Portuguese stories must, with the revolution.
II. The Parent: EDP & Portuguese Energy History
Origins of the Mother Ship
The morning of April 25, 1974, began with a song. At 12:20 AM, Portuguese radio stations broadcast "Grândola, Vila Morena"—the signal for military units across the country to begin the Carnation Revolution, ending nearly five decades of authoritarian rule. Within hours, the dictatorship had collapsed. Within months, Portugal's economic landscape would be unrecognizable.
The Carnation Revolution, which overthrew the authoritarian Estado Novo regime through a military coup, ushered in a provisional government influenced by Marxist elements that pursued sweeping nationalizations. In the electricity sector, Decree-Law 205-G/75, enacted on April 16, 1975, authorized the state seizure of private companies engaged in generation, transmission, and distribution, affecting around 14 enterprises that controlled the majority of Portugal's power infrastructure.
From this revolutionary chaos emerged order—of a sort. EDP was founded as Electricidade de Portugal, E.P., by the Portuguese government through the Decreto-lei n.º 502/76 published on June 30, 1976, merging 14 former energy companies that had been nationalised by 1975 in the aftermath of the regime change in 1974, of which the most significant had been the Companhia Portuguesa de Eletricidade (CPE).
The company's main goals were to have an integrated distribution throughout the municipalities and to improve the grid; to continue increasing the use of electricity in Portugal; and to establish a single tariff throughout the country. It was statecraft through electricity—a unified national project to bring light to a country still emerging from backwardness.
The initial ownership structure was entirely state-controlled, with the Portuguese state acting as the sole shareholder. The government's strategic intent was to create a unified and publicly managed energy sector, aiming to ensure widespread access to electricity and gas throughout the nation.
For fifteen years, EDP functioned as a classic state monopoly—bureaucratic, reliable, and utterly unconcerned with efficiency or innovation. EdP was a near monopoly in generation, transmission, and distribution until its privatisation in June 1997. The transformation came as Portugal prepared to join the European mainstream.
Following nationalization in 1975 and its formal establishment as a state-owned enterprise in 1976, EDP underwent significant restructuring in the early 1990s amid Portugal's economic liberalization efforts and alignment with European Union directives on energy markets. In 1991, EDP transitioned from a public entity to a public limited company, enabling preparation for partial privatization. A major reorganization in 1994 separated its operations into distinct units for generation, transmission, and distribution, facilitating compliance with emerging competition rules.
In EdP's initial public offering in June 1997, some 200,000 investors were targeted, representing a substantial increase over the levels of around 90,000 in some previous Portuguese offerings. The Portuguese state would continue privatizing in phases for another decade and a half.
The Strategic Shift to Renewables
The European Union's renewable energy directives of the early 2000s would prove transformative. Brussels mandated that member states increase their share of electricity from renewable sources—binding targets that forced utilities across the continent to fundamentally rethink their business models.
For EDP, the calculation was straightforward. Portugal had limited fossil fuel resources but abundant wind along its Atlantic coast and in its mountainous interior. The company had been developing wind farms since 1996, but these were modest affairs—pilot projects rather than strategic imperatives. The EU directives changed everything.
In March 2007, the group made a US$3 billion takeover of Horizon Wind Energy, the Texan-based wind power producer. At the time, it was the largest renewable energy deal to date and made EDP the fourth-largest wind power producer in the world.
That transaction—which we'll examine in detail shortly—was merely the largest expression of a broader strategic pivot. EDP had concluded that renewables weren't just a regulatory compliance obligation but a fundamental growth opportunity. The question was how to pursue that opportunity while managing the capital requirements, operational complexity, and investor expectations of a listed company.
The answer was a corporate carve-out: create a separate entity to hold and operate the renewable assets, raise external capital through a partial IPO, and maintain strategic control through majority ownership. EDP Renováveis was established in 2007 to hold and operate the growing renewable energy assets of parent company Energias de Portugal (EDP Group), Portugal's largest utility company headquartered in Lisbon.
The timing would prove both brilliant and brutal. Brilliant because it positioned EDP to lead the renewable transition a full decade before most utilities recognized its importance. Brutal because EDPR's public market debut would coincide with the worst financial crisis in eighty years.
III. The Birth of EDPR & IPO (2007-2008)
Founding & Structure
EDP Renováveis, S.A. was incorporated in 2007 and is headquartered in Madrid, Spain. The choice of Madrid—rather than Lisbon or Houston, where the company's largest operations resided—reflected both geographic pragmatism and the importance of the Spanish market to EDPR's portfolio. EDP Renováveis is a renewable energy company registered in Oviedo, and headquartered in Madrid that designs, develops, manages and operates power plants that generate electricity using renewable energy sources.
The corporate structure was intentionally complex. EDP would retain majority ownership, providing balance sheet support and strategic direction. But minority shareholders would have their own equity stake in the pure-play renewables business—a "cleaner" investment thesis than EDP's diversified portfolio of generation, distribution, and gas operations.
The Horizon Wind Energy Acquisition—The Defining Move
To understand EDPR's trajectory, you must understand Horizon Wind Energy—and to understand Horizon, you must understand the Zilkhas.
Zilkha Renewable Energy, headquartered in Houston, Texas, was founded six years ago by Selim Zilkha, founder of the European Mothercare store chain, and his son Michael. Selim Zilkha's biography reads like a novel: born in Baghdad in 1927 to a prominent banking family, his businesses were expropriated across the Middle East as Arab nationalism spread. He reinvented himself in Britain, building Mothercare into one of the UK's largest retail chains before selling in the early 1980s.
In his sixties, most entrepreneurs would have retired. Zilkha pivoted to energy. From 1986 to 1998, Michael Zilkha was co-owner and executive vice president of Zilkha Energy, and from 1998 to 2005 president and co-owner of Zilkha Renewable Energy, until it was bought by Goldman Sachs in July 2005 and renamed Horizon Wind Energy. In 1998, Zilkha and his father sold the Houston-based Zilkha Energy to Sonat for $1 billion.
The father-son team had spotted the opportunity in wind before most Wall Street analysts could locate Oklahoma on a map. "The wind industry is rapidly developing into a market in which success depends on the integration of development, construction, and operations with finance and ownership," Zilkha observed. The company had nearly 4,000 MW of wind projects in various stages of development in 12 states.
In 2005, the company (then called Zilkha Renewable Energy, and owned by Selim Zilkha and Michael Zilkha) was purchased by investment bank Goldman Sachs for an undisclosed sum and renamed Horizon Wind Energy. In 2007, the company was acquired by Energias de Portugal for $2.15 billion.
EDP signed an agreement to acquire 100% of the share capital of Horizon Wind Energy LLC, a leading developer, owner and operator of wind power generation in the United States, from The Goldman Sachs Group, Inc. The transaction valued the equity of Horizon at USD 2,150 million.
The final price of the transaction was set at an enterprise value of USD 2,740 million for Horizon, already including the capital expenditures supported by Goldman Sachs between the end of 2006 and the closing date.
The strategic rationale was crystal clear. The acquisition of Horizon accelerated the implementation of EDP's strategic guidelines, enhanced EDP's global leadership in renewable generation, provided entry into the high-growth US market with a leading position, and diversified EDP's income sources. Since it was founded in 1999, Horizon had been one of the most successful wind developers in the United States, largely because of its highly experienced management team.
EDPR entered the US market in 2007 with the acquisition of Horizon Wind Energy LLC from Goldman Sachs. Since then, EDPR more than doubled its wind-power production, making it one of the world's largest producers. The US is EDPR's biggest market in terms of installed capacity and production.
The acquisition transformed EDPR overnight from a regional European player into a global renewable energy company—and positioned it perfectly for the American wind boom that would define the following decade.
The IPO
On June 4, 2008, following an Initial Public Offering, EDP Renováveis, S.A. became a publicly traded company listed in the Euronext Lisbon.
The EDPR IPO raised a total of €1.566 billion. Priced at €8.00 per share—midway between the offering price range of €7.40 to €8.90 per share—the Public Subscription Offer was oversubscribed by 87.9 times. In challenging financial markets, the success of the IPO clearly demonstrates the high regard investors have for EDPR as the fastest growing pure-play among the world's largest global renewables companies.
EDP listed 22.5% of the company in an initial public offering on Euronext Lisbon in June 2008 at €8.00 per share, upon which it immediately became a member of the benchmark PSI-20 index as its fifth-largest company by market capitalization.
The timing, in retrospect, was catastrophic. June 2008 was three months before Lehman Brothers collapsed. The subsequent financial crisis would hammer renewable energy stocks globally, as capital dried up and project financing became nearly impossible.
Since 2009, EDPR's share price had been decreasing as a consequence of the generalized crisis. Share prices decreased until July, increasing until December with a closing price of €3.99.
In spring 2017, EDP launched a buyback offer at €6.80 per share for the minority shares in EDPR, 15% below the original price 9 years earlier. That single statistic captures the decade of underperformance that followed the IPO—even as the underlying business grew dramatically.
For investors, this was a harsh lesson in the distinction between operating performance and stock price returns. EDPR was executing brilliantly, adding gigawatts of capacity and expanding into new markets. But the shares languished, weighed down by sector-wide pessimism about renewable energy economics, European sovereign debt concerns, and the overhang of EDP's majority ownership.
IV. Geographic Expansion & Building Scale (2008-2015)
The Brazilian Entry
While Europe and the United States dominated EDPR's early strategy, management recognized that emerging markets offered both growth opportunities and portfolio diversification. Brazil, with its vast land mass, excellent wind resources, and growing electricity demand, was the obvious choice.
The company began cautiously. EDPR Brazil's history started in 2009 with the acquisition of two wind farms named Horizonte and Água Doce, in the State of Santa Catarina. These were modest projects—a toe in the water rather than a cannonball.
Brazil's regulatory framework for renewables was evolving rapidly. The government's auction system for power purchase agreements provided long-term revenue visibility, while the country's grid integration challenges created both obstacles and opportunities. EDPR would spend the next several years building a meaningful Brazilian presence, though the market would never rival North America or Europe in strategic importance.
European Consolidation
EDPR has continued to grow in recent years and is now present in 13 international markets (Brazil, Canada, Mexico, United States, Spain, Portugal, France, United Kingdom, Poland, Italy, Romania, Belgium and Greece).
Each European market presented unique regulatory structures, grid dynamics, and competitive landscapes. Spain and Portugal offered feed-in tariffs that guaranteed attractive returns. Poland's green certificate scheme provided a different mechanism—and a different risk profile. France's permitting process was notoriously slow but delivered long-duration contracts for patient developers.
The complexity was staggering. EDPR had to maintain regulatory expertise across a dozen jurisdictions, navigate local political dynamics, and manage currency exposures that shifted with every European election. Few companies could have executed such a strategy; EDPR benefited from parent company EDP's decades of experience operating across the Iberian peninsula and beyond.
US Dominance
EDPR is the world's fourth-largest wind energy producer, and EDPR NA represents EDPR's largest market in terms of installed capacity and production.
Headquartered in Houston, Texas, with 58 wind farms and 9 solar parks, EDP Renewables North America operates more than 8,200 megawatts of renewable energy projects in 14 U.S. states as well as in Canada and Mexico.
The American wind market was booming. The Production Tax Credit (PTC) provided powerful incentives for development, while state-level renewable portfolio standards created captive demand from utilities. EDPR's early entry through Horizon gave it relationships, pipeline, and expertise that later entrants would struggle to replicate.
The company's timeline tells the story: 2001 – Madison Wind Farm is commissioned, becoming the company's first operational clean energy project and the first utility-scale wind project in New York. 2005 – Zilkha Renewable Energy is purchased by Goldman Sachs and renamed Horizon Wind Energy. 2007 – Twin Groves Wind Farm begins operations as the largest wind farm in Illinois. 2007 – Horizon Wind Energy is purchased by EDP Renewables. 2009 – Horizon Wind Energy is renamed EDP Renewables North America.
By 2015, EDPR had built an American franchise that rivals envied. The company's US operations generated the bulk of its electricity output, benefited from favorable regulatory treatment through tax equity structures, and provided the foundation for continued growth.
V. Key Inflection Point #1: The Asset Rotation Model (2012-Present)
The Capital Recycling Innovation
In May 2012, EDPR's management team gathered in Madrid for their annual Investor Day presentation. What they announced that day would transform not just their company but the entire renewable energy industry.
EDPR commenced the execution of its asset rotation strategy, announced as one of its core objectives at the May 2012 Investor Day, to sell minority stakes in mature projects, operationally optimized and with a low risk profile.
The logic was elegant. Wind farms have front-loaded risk profiles: development, permitting, construction, and early operation carry uncertainty. But once a project has been running for several years, the risk profile drops dramatically. Cash flows become highly predictable, governed by long-term power purchase agreements and proven generation profiles.
Different investors have different risk appetites and return requirements. Infrastructure funds, pension plans, and insurance companies hunger for stable, long-duration cash flows. They'll pay premium multiples for de-risked assets. Developers like EDPR, meanwhile, can generate higher returns by taking projects through the risky development phase.
The asset rotation strategy is one of EDPR's core objectives, allowing the company to crystallize the value of its projects' future cash-flow stream and re-invest in the development of quality and value accretive projects, contributing to EDPR's self-funding growth strategy.
Evolution from Asset Rotation to Sell-Down
The model evolved as management gained confidence and investors demonstrated appetite. Initially, EDPR sold minority stakes—typically 49%—while retaining operational control and majority ownership. This preserved management economics while recycling capital.
Starting in 2018, EDPR introduced "sell-down" transactions: sales of majority stakes in late-stage development or operating projects. These transactions unlocked even more capital, though they required EDPR to become more comfortable with transferring control to partners.
Scale & Execution
EDPR has already signed four asset rotation transactions (with Borealis, CTG, Fiera Axium and Axpo) bringing the total amount by selling minority stakes in its wind farms in operation to €620 million.
Considering the €160 million of proceeds from each new asset rotation transaction, EDPR has already reached a total of €1,038 million by selling minority stakes in US and European assets, including the sale to CTG and asset rotation transactions with institutional investors since 2012. On closing one deal, João Manso Neto, then-CEO of EDP Renewables, stated: "I am pleased to announce this new partnership which is part of the asset rotation plan that the company has been implementing in order to deliver its growth strategy. With more than €1 billion of proceeds from asset rotations, EDPR is delivering on its strategy of funding growth by crystallizing the value of its projects' future cash-flow stream."
Since 2012 EDPR has agreed on more than €1 billion of proceeds from the sale of minority stakes in North American and European assets, including the sales to China Three Gorges. EDPR's growth strategy for the period 2014-2017 included an asset rotation target of €700 million.
EDPR continues to execute its asset rotation strategy, with approximately €0.7 billion already closed or signed and an additional €1.3 billion under binding bids for 2025. The company emphasized strong demand for these assets, with attractive sales multiples averaging €1.5 million EV/MW.
Why This Matters
The self-funding model freed EDPR from the constraints that limited many competitors. Rather than depending on corporate debt—with its covenants, refinancing risks, and balance sheet implications—EDPR could finance growth through a combination of operating cash flows, US tax equity structures, and asset rotation proceeds.
This was financial engineering in service of strategic flexibility. When attractive development opportunities emerged, EDPR had the capital to pursue them. When market conditions deteriorated, the company could slow its asset rotation pace without triggering financial distress.
For investors, the model creates complexity but also opportunity. Understanding EDPR's true earnings power requires looking through the noise of asset rotation gains, which can vary dramatically quarter to quarter depending on transaction timing. The underlying operational metrics—capacity growth, generation volumes, average selling prices—provide more stable indicators of business performance.
VI. Key Inflection Point #2: The China Three Gorges Takeover Battle (2018-2019)
The Setup: Chinese Investment in Portuguese Energy
The new reference partner of the increasingly multinational EDP was from China. China Three Gorges was chosen by the Portuguese state in the last round of privatization, beating out the competition from Brazilian companies Eletrobras and Cemig, and the German E.ON. 21.35% of the capital gave the Chinese company the largest shareholder participation in exchange for €2.69 billion.
The investment was born of necessity. Portugal's sovereign debt crisis had forced the government to sell assets—and CTG offered the highest price. For CTG, the transaction provided a beachhead in European energy and access to EDP's renewable expertise, which the Chinese company hoped to leverage for its own energy transition.
For seven years, the relationship functioned smoothly. CTG was a passive shareholder, content to collect dividends and learn from EDP's operations. The arrangement might have continued indefinitely had CTG not decided to reach for control.
The Bid
China's biggest clean energy company offered €9.1 billion ($10.9 billion) to buy the shares that it didn't already own of electricity giant EDP-Energias de Portugal SA. The €3.26 per-share bid was 4.8 percent higher than EDP's closing stock price. Three Gorges, already the biggest shareholder of Portugal's leading utility and power-plant developer, said the offer is subject to the bidder holding 50 percent of EDP's voting rights plus one after the offer.
CTG launched its takeover bid in May 2018, offering €3.26 euros per share, an amount judged too low by EDP. The Chinese state-owned company also launched a bid for EDP's renewable energy subsidiary EDP Renovaveis.
CTG offered €7.33 per share for EDP Renováveis, the separately listed renewables company that is 83% owned by EDP.
The Resistance & Regulatory Hurdles
The bid sparked immediate resistance. EDP's board rejected the offer as inadequate, and minority shareholders—including powerful activist investors—mobilized opposition.
Elliott Management put forward several criticisms of CTG's offer. First, it said the price was simply too low, at a roughly 5% premium to EDP's share price at the time. A "typical" premium in such a takeover bid would be in the 27%-40% range, Elliott argued, and the hedge fund believed EDP was already undervalued.
"With nearly every regulatory issue still unresolved... the bid is already one of the longest M&A processes the utilities sector has ever seen, and has clearly stalled," Elliott's letter stated.
The regulatory challenges were formidable. Any acquisition would require approvals across multiple jurisdictions—and the US posed particular concerns.
Elliott noted that EDPR North America is among the company's most valuable assets globally—with more than 6GW in operation, and a top-5 position in the booming US wind market. EDPR blasted into the US wind market through its well-timed acquisition of developer Horizon Wind Energy from Goldman Sachs. Amid ongoing trade tension between the US and China, "EDP would likely need to divest its US renewables portfolio" in order for CTG to close its takeover.
The Resolution
Shareholders in Portugal's biggest company, Energias de Portugal, on Wednesday blocked a nine-billion-euro takeover bid by the state-owned China Three Gorges Corporation. The rejection of the bid by the Chinese energy behemoth came amid growing unease within the European Union over a surge of Chinese state investment. Energias de Portugal said in a statement that the shareholders rejected the takeover because of a regulator requirement that their voting rights be modified.
China Three Gorges Corp.'s proposed takeover of EDP collapsed after 56% of EDP shareholders voted against the reformation of voting rights, which was a prerequisite to CTG's proposal. Removing a 25% cap on voting rights at EDP, which applies to all shareholders regardless of their stake in the company, was one of the conditions for CTG's plan to take over the company.
The failed takeover had lasting implications. In January 2021, alterations in EDP's shareholder structure took place as a result of the failed takeover. CTG's stake was modified to 19.03%. As of February 2022, China Three Gorges boosted its equity position to 20.22%.
In October 2024, EDPR announced a notable transaction that effectively unwound some of the CTG partnership. EDPR completed the buyback of a 49% stake in a wind portfolio in Portugal, Poland and Italy from two entities related with China Three Gorges for a total consideration of €0.58bn. The transaction covers a portfolio with total gross operating wind capacity of 970 MW.
The failed takeover preserved EDPR's strategic independence at a crucial moment. Had CTG succeeded, the company's US operations would likely have been divested to satisfy regulatory concerns—stripping EDPR of its single most valuable market. The shareholder vote in April 2019 may well have saved the company's future.
VII. Key Inflection Point #3: Ocean Winds & Offshore Expansion (2019-Present)
The ENGIE Partnership
In November 2019, EDP announced that it had reached a 50/50 Joint Venture agreement with the French gas and power company Engie to merge their fixed and floating offshore wind power activities, primarily targeting markets in Europe, the United States and selected geographies in Asia.
Ocean Winds is an international company dedicated to offshore wind energy and created as a 50-50 joint venture, owned by EDP Renewables and ENGIE. Based on the belief that offshore wind energy is an essential part of the global energy transition, Ocean Winds develops, finances, builds and operates offshore wind farm projects all around the world.
The partnership was born of strategic necessity. Offshore wind projects require capital commitments in the billions—scale that few developers can shoulder alone. By pooling assets and pipeline, EDPR and ENGIE created an entity with the heft to compete for the largest projects globally.
Strategic Rationale
When EDP and ENGIE combined their offshore wind assets and project pipeline to create OW in 2019, the company had a total of 1.5 GW under construction and 4.0 GW under development; OW has been adding rapidly to that portfolio and is now on a trajectory to reach the 2025 target of 5 to 7 GW of projects in operation, or construction, and 5 to 10 GW under advanced development.
Marquee Projects
The partnership delivered results quickly.
WindFloat Atlantic is an offshore floating wind farm located 20km off the coast of Viana do Castelo, Portugal. Commissioned in January 2020, the project is considered to be the world's first semi-submersible floating wind farm and the first floating wind farm in continental Europe. The wind farm was developed by the Windplus consortium that includes EDP Renewables (54.4%), Repsol (19.4%), Engie (25%) and Principle Power (1.2%).
WindFloat Atlantic was the first full-scale floating wind farm to use semi-submersible technology and the first floating wind project to secure bank financing. Operating 20 km offshore Viana do Castelo, in Portugal, the project features three WindFloat platforms.
WindFloat Atlantic has been operating since 2020, delivering a cumulative 320 GWh of energy over its four years of operation, above initial expectations. The project also showed resilience in extreme weather conditions, like Ciaran Storm, when the WindFloat® units withstood 20-meter waves and wind gusts of 139 km/h without any structural damage.
Meanwhile, in Scottish waters, Ocean Winds was delivering at commercial scale.
Moray East is a 100-turbine wind farm off the north-east coast of Scotland, which marks a radical turning point in the country's renewable energy supply: since April 2022, the farm has met 40% of Scotland's electricity requirements.
The wind farm was consented in 2014 and construction began in 2019. The first power was exported in June 2021 and the farm reached full power output in April 2022. The wind farm includes 100 Vestas V164-9.5 MW turbines for a total generating capacity of 950 MW.
Located in the Moray Firth region and in operation since 2022, the Moray East offshore wind farm generates clean energy for more than 1.43 million Scottish households and is operated from its base in Fraserburgh, managed by Ocean Winds.
Floating Wind Pioneer
Ocean Winds was recently awarded rights to develop a floating offshore wind site in the Celtic Sea. The 358 km2 site will allow the development of a floating offshore wind project located in water depths of 71 – 88 metres, with potential final capacity of up to 1.5 GW.
Ocean Winds is a global leader in floating technology, having delivered the world's first semi-submersible floating wind farm, WindFloat Atlantic, in Portugal in 2020, and more recently the EFGL floating demonstrator site in France. They have further commercial scale projects already under development in South Korea and France. With a proven track record of delivery in the UK including Moray East and Moray West, which together make OW the largest offshore wind operator in Scotland.
In Asia, Ocean Winds is developing Hanbando Offshore Wind, a bottom-fixed offshore wind project with a planned capacity of 1,125 MW, located 120 kilometres off the coast of Incheon, within South Korea's Exclusive Economic Zone. In early 2025, the project was granted its Electricity Business License, securing development rights over the sea area and reserving interconnection capacity.
The US market, however, has presented challenges. A US federal judge ruled in favor of a motion that the Bureau of Ocean Energy Management would voluntarily remand the approval given to the SouthCoast Wind project so it could be reconsidered. Ocean Winds, the developer of the 2.4 GW offshore wind project, said it was assessing the implications of the decision.
VIII. The Modern Era: Solar Pivot & Hybrid Projects (2020-Present)
Technology Diversification
EDPR's evolution from pure-play wind developer to diversified renewable platform accelerated after 2020. Solar economics had improved dramatically, and battery storage was becoming commercially viable at utility scale.
In May 2025, EDPR NA celebrated the inauguration of its 200 megawatt Scarlet II Solar Energy Park in Fresno County, California. Scarlet II follows EDPR NA's Scarlet I Solar Energy Park, consisting of 200 MW of solar and 40 MW/160 MWh of battery energy storage system, which achieved commercial operation in 2024. This second phase of the Scarlet Solar Energy Park includes a co-located 150 MW/600 MWh BESS.
Salt River Project and Flatland Storage LLC, a subsidiary of EDPR NA, entered into an agreement to provide 200 megawatts of new energy storage to Arizona's grid. The Flatland Energy Storage Project will be a 200 MW/800 megawatt-hour battery energy storage system located near Coolidge, Arizona. The project will utilize lithium-ion technology, designed and manufactured in the U.S. by Tesla. Scheduled to be online in 2025.
"We're excited to be partnering with SRP on the largest utility-scale storage project in the EDP Group's global portfolio to date," said Sandhya Ganapathy, CEO of EDP Renewables North America. "Storage is key to modernizing the US power grid and is a requisite in accelerating the adoption of renewable energy."
Current Scale & Operations
EDPR NA has developed more than 12,000 megawatts and operates more than 11,400 MW of onshore utility-scale renewable energy projects. With more than 1,000 employees, EDPR NA's highly qualified team has a proven capacity to execute projects across the continent.
EDPR NA DG has reached an operating capacity of more than 280MWac of solar and storage assets across more than 500 active sites spanning 25 states, positioning the company as one of the leaders in distributed generation in the US.
EDPR NA's U.S. operations in 2025 are marked by a diversified portfolio of solar and storage projects. The company has delivered three new utility-scale solar projects in 2025 alone, totaling 400 MW, with long-term virtual power purchase agreements with Microsoft. These include the 140 MW Wolf Run Solar Project and the 110 MW Hickory Solar Project in Southern Illinois, as well as the 150 MW Cattlemen II Solar Project in Texas.
The company is advancing an extensive development pipeline, including a ground-breaking partnership with Google, as it continues to showcase innovative spirit and dedication to sustainable energy solutions, targeting high-demand regions of the US in a context of rapid load growth. The message is clear: distributed generation is needed to ensure a more resilient and reliable grid.
IX. Playbook: Business & Investing Lessons
The EDPR Model—What Makes It Work?
1. Parent Company Advantage: EDPR benefits from EDP's balance sheet, operational expertise, and institutional relationships while maintaining the operational independence to pursue pure-play growth opportunities. This hybrid structure—neither fully independent nor fully integrated—provides strategic flexibility that few competitors can match.
2. Geographic Diversification: EDPR operates in three broad geographic areas: Europe, North America and South America. This diversification provides natural hedges against regulatory changes, currency movements, and resource variability in any single market.
3. The Capital Recycling Flywheel: The asset rotation model—described in detail earlier—remains EDPR's signature innovation. By selling mature assets at premium multiples and reinvesting in development, EDPR generates returns that exceed what either pure development or pure ownership strategies could achieve.
4. Operational Excellence: EDPR's superior technical capabilities—in site selection, turbine optimization, and maintenance—drive capacity factors that consistently exceed industry averages. In a commodity business, operational excellence is a sustainable competitive advantage.
Leadership & Execution
Miguel Stilwell d'Andrade graduated with a mechanical engineering degree from the University of Strathclyde in Scotland and an MBA from MIT, joining EDP in 2000, working on strategy and corporate development, along with mergers and acquisitions. He became CEO of both EDP Group and EDP Renewables in January 2021.
In his journey at EDP, Stilwell led the main transactions that shaped the foundations of the group, including the IPO of EDP Energias do Brasil and EDP Renewables in 2008, the acquisition of Horizon Wind Energy in the USA, and the acquisition of Sunseap in Asia and Kronos in Germany.
"One thing has been very clear: the energy transition will have to go even faster," Stilwell has said. His passion for renewable energy is evident: "Apart from just being an interesting sector, it's being able to have an impact, being able to feel that externally EDP is making a difference, that we are changing tomorrow now."
Key Strategic Lessons
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First-mover advantage in US wind through M&A: The Horizon acquisition gave EDPR pipeline, relationships, and expertise that would have taken a decade to build organically.
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Partnership model for capital-intensive frontier technologies: Ocean Winds demonstrates how joint ventures can unlock opportunities beyond single-company balance sheet capacity.
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Long-term PPA contracting for revenue visibility: EDPR's high percentage of contracted generation provides earnings predictability that supports premium valuation multiples.
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Balancing growth with financial discipline: The self-funding model ensures growth doesn't compromise financial stability.
X. Porter's Five Forces Analysis
1. Threat of New Entrants: MEDIUM-LOW
The renewable energy development business requires significant barriers to entry: capital commitments measured in billions, permitting expertise that takes years to develop, and relationships with landowners, communities, and utilities that compound over decades. However, well-capitalized oil majors (BP, Shell, TotalEnergies) and sovereign wealth funds have entered aggressively, bringing essentially unlimited balance sheets to bear.
2. Bargaining Power of Suppliers: MEDIUM-HIGH
Turbine manufacturers have consolidated significantly—Vestas, Siemens Gamesa, and GE control the majority of supply. Post-COVID supply chain disruptions elevated pricing power further. EDPR mitigates through scale and long-term framework agreements, but remains price-taker rather than price-maker for critical equipment.
3. Bargaining Power of Buyers: MEDIUM
Corporate PPAs with Amazon, Google, and Microsoft have become standard—these sophisticated buyers negotiate aggressively. However, regulatory mandates create baseline demand that developers can rely on, and merchant exposure in many markets provides pricing optionality.
4. Threat of Substitutes: LOW-MEDIUM
Nuclear renaissance in some jurisdictions and natural gas as transition fuel represent theoretical substitutes. Emerging green hydrogen could complement or compete. However, wind and solar remain lowest cost new-build generation in most markets, and battery storage increasingly makes renewables dispatchable.
5. Competitive Rivalry: HIGH
The renewable energy market includes several major players: Orsted, Iberdrola, NextEra Energy Resources, Enel Green Power, ENGIE Renewables, EDP Renewables, Brookfield Renewable, RWE Renewables, and China Three Gorges Renewables.
Enel, Iberdrola, NextEra Energy and Orsted prioritized the building or buying of clean-power plants when those assets were still considered alternative and expensive. Now they're on the cusp of a breakthrough.
Auction-based procurement drives down returns across the industry, while the race for best sites intensifies globally. EDPR's position as fourth-largest wind producer provides scale advantages, but several competitors are larger and better capitalized.
XI. Hamilton's 7 Powers Framework Analysis
1. Scale Economies: MODERATE POWER
EDPR is 4th in the world in wind energy based on net installed capacity and is consistently ranked in the top three in terms of growth in the sector. At the end of 2018, EDPR had added 11.7 GW of installed wind capacity.
Scale enables better turbine procurement pricing and centralized O&M monitoring. However, wind farms are relatively modular—smaller players can compete effectively in specific markets. Scale economies exist but are not overwhelming.
2. Network Effects: WEAK
This is not a platform business with direct network effects. Some indirect effects exist through reputation with landowners and communities—developers with successful track records find it easier to secure sites. But these effects are modest.
3. Counter-Positioning: STRONG (Historically)
EDPR's pure-play renewables focus was counter-positioned against integrated utilities that faced the incumbent's dilemma—investing in renewables cannibalized existing thermal assets. This advantage has eroded as legacy utilities have now pivoted aggressively to renewables.
4. Switching Costs: MODERATE
Long-term PPAs (15-25 years) create customer lock-in. Asset rotation partners have ongoing relationships that create soft switching costs. However, most switching costs accrue to the customer rather than to EDPR.
5. Branding: WEAK
Electrons are commodities. While corporate buyers may prefer renewable certificates from established developers, this preference doesn't command meaningful price premiums.
6. Cornered Resource: MODERATE
Development pipeline—particularly in markets like the US with complex permitting requirements—represents a cornered resource. High-quality wind sites with grid access are finite. EDPR's existing positions are valuable.
7. Process Power: MODERATE
EDPR's asset rotation model represents genuine process innovation—the ability to systematically develop, optimize, and sell assets generates returns that competitors have struggled to replicate.
XII. Key Performance Indicators
For investors tracking EDPR's ongoing performance, three metrics deserve primary attention:
1. Underlying EBITDA Growth (Excluding Asset Rotation Gains)
Asset rotation gains can swing wildly based on transaction timing. Underlying EBITDA saw a 20% year-on-year increase excluding asset rotation gains in the first half of 2025. This metric captures the true operating trajectory of the business.
2. Capacity Additions (GW per Year)
New capacity drives future generation and revenue. The company's 2025 target for capacity additions remains at approximately 2 GW, with good visibility on additions of up to 1.5 GW for 2026, with approximately 65% of this target already secured at above-target risk/return profiles.
3. Average Selling Price (€/MWh)
Electricity generation rose 12% year-on-year to 21.2 TWh while average selling price declined 9% to €54.9/MWh. The interplay between volume growth and price realization determines revenue trajectory.
XIII. Bull Case & Bear Case
Bull Case
EDPR is positioned to benefit from multiple structural tailwinds: government mandates driving renewable adoption, corporate sustainability commitments creating demand for clean power, and falling technology costs improving project economics.
The US market—EDPR's largest and most profitable—is experiencing a renaissance of power demand from data centers and AI infrastructure. The U.S. energy market is accelerating, driven by rising demand and need for new capacity. Renewables are an important part of this, and EDP Renováveis is well positioned in this market context.
The Ocean Winds joint venture provides optionality on offshore wind—a market that could prove transformational as technology improves and costs decline. Floating offshore wind, where EDPR has pioneering experience through WindFloat Atlantic, could unlock vast new resource areas.
The asset rotation model continues to generate attractive proceeds while funding growth. EDPR continues to execute its asset rotation strategy, with approximately €0.7 billion already closed or signed and an additional €1.3 billion under binding bids for 2025. The company emphasized strong demand for these assets, with attractive sales multiples averaging €1.5 million EV/MW.
Bear Case
Interest rate sensitivity remains significant. Renewable energy projects are long-duration assets whose economics depend heavily on financing costs. If rates remain elevated, project returns will compress.
The U.S. House of Representatives' budget reconciliation bill threatens to eliminate several clean-energy tax credits. The company's CEO has emphasized that installation targets for 2025 and 2026 will remain unchanged regardless of the final bill outcome—but uncertainty around US policy creates risk.
Power price pressures present ongoing challenges. Despite a challenging market with a 9% drop in average selling prices, the stock's recent performance reflects ongoing investor interest. Oversupply of renewable generation in certain markets has pressured merchant returns.
Competition is intensifying. The renewable energy development industry has attracted massive capital inflows, driving down returns in competitive auctions. EDPR's scale advantages may not be sufficient to maintain historical margins.
For Ocean Winds, regulatory uncertainty in the US market presents challenges. SouthCoast Wind has invested over $600 million in responsible development and permitting activities, yet faces regulatory reconsideration that puts the project at risk.
XIV. Conclusion: The Quiet Portuguese Revolution
EDP Renováveis emerged from the wreckage of Portugal's post-revolutionary economy to become one of the world's preeminent renewable energy companies. The journey required vision, execution, and no small amount of luck—timing that placed EDPR in the US wind market just before a decade-long boom, and a shareholder vote that preserved independence just before Chinese ownership would have required dismemberment of the company's most valuable assets.
EDP is a global leader in renewables, networks and client solutions, with operations in 29 markets across Europe, North America, Latin America and Asia-Pacific. More than 75% of the energy produced by EDP comes from renewable sources, and the goal is to be all-green by 2030. Miguel Stilwell d'Andrade has accumulated more than 20 years of experience in the energy sector, spending the early part of his career in Investment Banking before becoming a leader at EDP since 2000.
The company's story is far from complete. The energy transition is accelerating, and EDPR—through its own operations and its Ocean Winds partnership—holds positions that could prove transformational as wind, solar, and storage reshape global power systems.
For investors, EDPR presents a pure-play vehicle for exposure to the renewable energy transition—cleaner and more focused than integrated utilities, more globally diversified than US-only alternatives. The stock's volatile history since its 2008 IPO demonstrates both the opportunities and risks inherent in this sector. Understanding the asset rotation model, monitoring underlying operational metrics, and tracking the competitive dynamics of key markets will be essential for those following this Portuguese revolution in renewable energy.
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