UK green investment bank invests 58.6 million to refinance offshore wind farm
- Bank of Tokyo-Mitsubishi (BTMU)
- DONG Energy
- KfW IPEX Bank
- Sumitomo Mitsui Banking Corporation (SMBC)
- Green Investment Group Ltd (former UK Green Investment Bank)
The investment will refinance a significant portion of Masdar's 20% equity stake in the project. GIB's senior debt commitment is being made alongside co-lenders: The Bank of Tokyo-Mitsubishi UFJ, Ltd; KfW IPEX-Bank GmbH; Siemens Bank GmbH; and, Sumitomo Mitsui Banking Corporation. The capital released from this refinancing will be reinvested into the UK offshore wind sector, by Masdar. The total investment is £266 million.
London Array is a 630MW operational wind farm off the coast of Kent, England. It is the largest operating offshore wind project in the world, and was inaugurated by David Cameron, UK Prime Minister, on 4 July 2013. It is owned by DONG (50%), E.ON (30%) and Masdar (20%). Over its lifetime London Array is expected to save 8.5 million tonnes CO2e.
This is GIB's third investment in offshore wind operating assets. GIB designed this strategy to achieve two objectives:
- To demonstrate the attractiveness of investments in operating assets to domestic and international investors with the aim of crowding-in additional new capital; and
- To release capital back into the development and construction phase of new projects.
GIB's other investments in offshore wind to date are Walney and Rhyl Flats. This takes GIB's investment in UK offshore wind to £162 million.
Dr. Sultan Ahmed Al Jaber, CEO of Masdar, said:
"Reaching financial close on a project of this scale and complexity marks another milestone in Masdar's dedication to breaking new ground within the renewable energy sector. London Array is delivering half a million UK homes with clean energy and further reinforcing the UAE's position as a responsible and diversified energy supplier. Masdar is actively engaged in exploring new investment opportunities in the UK's growing renewable energy market, especially in the offshore wind sector."
You can see a two minute film clip of Shaun Kingsbury, chief executive of GIB, talking about GIB's investment in London Array here.
The UK Green Investment Bank was launched in November 2012. With £3.8 billion of funding from the UK Government, it is the first "for profit" bank of its kind in the world.
Masdar is Abu Dhabi's renewable energy company advancing the development, commercialisation and deployment of clean energy technologies and solutions. The company is backed by the Mubadala Development Company PJSC, the strategic investment company of the government of Abu Dhabi.