New Zealand state utility buys Cleantech America in solar foray

New Zealand state-owned electricity producer Meridian Energy is to pay US$5.4m (£3.6m) to acquire Cleantech America, a San Francisco-based developer of solar farms, as it seeks to break into the lucrative US renewable energy market.

The deal will give Meridian, which operates wind farms and hydropower projects in its home market, a foothold in California's booming solar energy sector.

The acquisition includes a 5MW photovoltaic solar project that Cleantech is building in Mendota, California. Electricity generated from the facility will be sold to northern California utility firm Pacific Gas & Electric under a long-term power purchase agreement.

Meridian is New Zealand's largest electricity supplier, accounting for about 30 per cent of the nation's energy needs. The utility's chief executive, Tim Lusk, said that "moving into the US represents a very important step for Meridian and for the first time adds solar to our renewable portfolio".

He added that Meridian is also examining potential solar projects in Australia and the Pacific Islands.

The utility operates New Zealand's largest hydroelectric dams. Drought conditions over the past decade have likely prompted Meridian to diversify into other areas of the energy sector in recent years.

Meridian operates three wind farms in New Zealand and is currently building another in Antarctica, due to be completed in February 2010.