Neoen, a French leader in renewable energy
Neoen's mission is to develop, finance and manage electricity and heat generation projects operating on renewable energy. Interview with Xavier Barbaro, CEO of the company changing the rules of the game in France, where nuclear energy predominates.
Founded in 2008, Neoen has become the third-largest producer of renewable energy in France after EDF and Engie. That's a real success story!
Xavier Barbaro: The interesting thing about the story is that we launched Neoen at the time of the speculative bubble, when everyone was getting in on renewable energy. There were about 300 companies in France at the time. Today, thanks to our business model, we are one of the few still remaining. We were a start-up, then we became an SME, and now we're a medium-sized company, a rare species in France. Over the past three years, we've invested €600 million in France and abroad, and we're planning to invest almost €1 billion over the next three years.
Societe Generale was both the major lender and the arranger for the financing. The bank made it possible for us to find European lenders and to have the right conditions in place to carry out this project, which represented an investment of €360 million. Having a strong relationship with the bank is a necessity!
Xavier Barbaro, , CEO of Neoen
You've built Europe's largest solar energy park, located near Bordeaux. Can you tell us about this project?
X.B: The Cestas facility is a very important project for us. It's our largest energy park in terms of electric power. With an output of 300 megawatts, it can supply energy to 250,000 to 300,000 people, which is the entire population of Bordeaux. We produce three times more energy per hectare than the other energy parks built in France. Proof that solar power can provide a significant amount of electricity as well as high energy density. It's competitive because the energy produced is sold at €105 per megawatt hour, which is lower than the price of energy from the new EPR nuclear reactors. Lastly, we chose many French partners and sub-contractors, like Eiffage and Schneider Electric. Most of the financing also came from France. Societe Generale was both the major lender and the arranger for the financing. The bank made it possible for us to find European lenders and to have the right conditions in place to carry out this project, which represented an investment of €360 million. We had already worked with Societe Generale's renewable energy financing team before, but Cestas was 10 times larger than what we had done together before. The bank also supported our innovative investments in wind turbines in Australia. Having a strong relationship with the bank is a necessity!
In your view, what are France's renewable energy challenges?
X.B: We need major programme of awareness-raising with the public authorities. The challenge is to show that there are French leaders in renewable energy and to lead by example. We need to show that we are capable, as the Cestas facility shows, of developing innovative and competitive projects that create jobs, receive international recognition and operate well.
What are your objectives?
X.B: The primary objective is to grow in France and internationally. Perhaps even launch an IPO on the Paris stock exchange. We'd like to quickly pass the 1,000 megawatt production mark and to continue innovating in terms of technology and cost while remaining profitable. We constantly strive to beat our own records. Our first solar facilities produced energy sold at €300 per megawatt hour. Three years later that price was €100, and one year after that €80. And while we know we're not an NGO, Neoen does make a positive contribution to society. Australia rates among the highest carbon dioxide emissions per capita in the world. By building a wind turbine facility there, we know we're making things better. What's interesting is that on a global scale, the effort is increasingly shared and a collective movement is forming. In Mozambique, for example, the government is delighted that we can offer inexpensive energy, but it's also important to the Mozambicans that this energy is clean. For us, it's a success story and we get the sense of participating to a common cause.