Dŵr Cymru Welsh Water is to buy several hydro-electric plants located across Wales in a £20.5 million deal.
The not-for-profit company, based in Nelson, will buy 14 turbines installed at nine reservoirs from Infinis Energy.
The deal is subject to approval from Welsh Water’s lenders and should be completed by the end of February. The move will help the company almost double its renewable energy generation to over 20% of the energy it uses.
During 2013, the company generated a record 43 GWh of renewable energy, saving 21,000 tonnes of carbon – compared with 37 GWh in 2012.
The turbines it plans to buy produce around 40 GWh a year – enough to power around 9,000 homes. The hydro plants include Llyn Brianne reservoir and Elan Valley in Powys.
Chris Jones, Chief Executive of Welsh Water, said: “As a company without any shareholders, our sole focus is on providing the best possible service to our customers at the most affordable price.
“We always look at ways of becoming more efficient and providing value for money and so by generating our own electricity, this will help us keep our costs down and our bills lower whilst also helping to safeguard the environment at the same time.”
Chief Executive of Infinis, Eric Machiels said: “We are pleased to announce that we have agreed the sale of our non-core hydro business. This will enable Infinis to streamline its operational portfolio by focusing on its core landfill gas and onshore wind businesses.
“It also allows us to recycle capital to continue to develop our onshore wind portfolio which remains central to our growth plans.”
As part of the deal two Infinis staff will transfer over to Welsh Water.
• Welsh Water is cutting household bills next year and the cost will continue to drop for five years, after industry watchdog Ofwat ordered price cuts.
The average bill for 2014/15 is £440 but by 2019/20 will fall to £416.
Ofwat wants all water companies to cut household bills in real terms by 5%. The new charges will come into effect in April 2015.
Chris Jones, Chief Executive of Welsh Water, said: “During this challenging price review, we needed to balance a number of priorities between making service improvements, safeguarding the environment whilst also keeping bills affordable by ensuring that we deliver a decade of below inflation price increases by 2020.
“Our customers have played a key part in shaping a very ambitious business plan that sets challenging performance targets for us between 2015 and 2020.”