Latest News from GFG Alliance
Wednesday 20th September 2017Press Release Energy
Sanjeev Gupta’s GFG Alliance, through its energy division, SIMEC Energy, today (20th Sept 2017) reached an agreement with ZEN Energy to establish a strategic partnership and acquire a majority stake in ZEN, a prominent emerging Australian energy company providing businesses and households with affordable, reliable and tailor-made solutions.
Having last month acquired Arrium, Australia’s largest integrated steel and mining business, GFG Alliance has now taken a major step towards realising its Australian energy ambitions. The opportunity to invest in large-scale power projects to meet its own industrial requirements and support the domestic economy was a key driver for GFG’s strategic entry into Australia.
ZEN has an experienced management team looking to develop and improve the national energy market through partnerships with governments, industries and households. Building on their experience in designing and installing solar and battery storage solutions for residential and commercial customers, ZEN now offers power supply solutions to large industrial customers. ZEN works closely with some of Australia’s largest energy users to reduce costs, increase reliability, and increase the amount of low-emissions energy used in industry.
ZEN uses a combination of energy sourced from new and existing power plants, demand management technologies and energy storage to deliver energy supply solutions at a competitive price. ZEN also manages the development of new renewable energy projects.
The strategic partnership and acquisition of a majority stake in ZEN Energy is an early win in GFG’s 100-day plan following its acquisition of the former Arrium business on August 31. These businesses, including SIMEC Mining Australia, SIMEC Infrastructure Australia and Liberty OneSteel (formerly Arrium), are substantial consumers of energy.
SIMEC ZEN Energy, the new name for the joint venture, will work to improve energy security and reduce the cost of power for GFG Alliance and other businesses in Australia.
SIMEC Zen Energy will become a member of the GFG Alliance and will work closely with SIMEC Energy’s existing global energy team which already has 600 MW of power generating assets in the UK with another 400 MW under development, ranging from solid biomass and liquid bio fuels, to hydro and tidal, to wind and solar, and also cutting-edge waste-to-energy projects.
ZEN Energy will partner with SIMEC to deliver cheaper, more reliable and environmentally sustainable energy for SIMEC’s mining operations in South Australia and Liberty OneSteel’s operations in South Australia, Victoria, New South Wales, Queensland, and Western Australia.
SIMEC ZEN Energy will also project-manage the development of SIMEC Energy Australia’s new large scale energy projects, including solar PV, battery storage and pumped hydro facilities.
Sanjeev Gupta, GFG Alliance’s Executive Chairman, said: “The high cost of energy for Australian consumers is debilitating for the economy and a crying shame for a country so rich in resources. We clearly see a need for industrial groups and energy generators to work together. Long-term sustainable energy solutions need to be founded on both economic and environmental principles in order to work properly. With our partners, we can deliver a step change in the power industry, bringing innovative solutions and new projects to dramatically reduce the cost of dispatchable power. “GFG Alliance is already one of the biggest users of industrial energy in Australia. Given the issues here, it has been a priority for us to take decisive remedial steps. Combining our power expertise developed in the UK, and Zen’s local knowledge in Australia, is a natural partnership.
“ZEN Energy is proudly Australian and brings unparalleled market and technological knowledge to address the challenges faced by the Australian power sector. We’re delighted to partner with them on projects and look to invest for further growth.
“Our main focus, as in the UK, will be renewable energy.
“This is an important milestone for GFG Alliance in Australia; I am excited about this joint venture and the role it will play in transforming the Australian power industry.”
Ross Garnaut, Chairman of ZEN Energy, said: “ZEN has spent many years building the strategy, business models and management and technological capacities to introduce new solutions to Australia’s energy problems of weak competition, high costs, low reliability and unnecessary pollution. We have been looking for the right capital investor and strategic partner to help realise our plans, and have found the perfect match in Sanjeev and the SIMEC Energy team. Their understanding of the energy dilemma this country faces, which is making much of our industry uncommercial and environmentally unsustainable, means we see the market need and opportunity in the same way. We are excited about the future, as this will yield benefits for Australian jobs, investors, communities and the environment.”
Australia & APAC
UK / Europe
Lois Brearley (iNHouse Communications)