GIB invests £500m in offshore windfarms at construction stage

The Green Investment Bank is committing £461 million to two offshore windfarms that are under construction, it announced on Monday. It is the first time the lender has invested at such an early stage of project development.

Japan’s Marubeni Corporation is partnering with the GIB to buy a 50 per cent stake in the 210MW Westermost Rough array from Dong Energy. The GIB is contributing £241 million to the transaction, worth around half a billion pounds in total.

The GIB is also buying a 10 per cent stake in RWE Innogy’s 576MW Gwynt y Mor windfarm for £220 million.

Samuel Leupold, executive vice president at Dong, hailed the decision as a “vote of confidence” in the company’s ability to build offshore windfarms.

RWE Innogy chief executive Hans Bunting said he was “delighted” by the move, adding: “Our aim is to raise additional capital for the extension of renewable energy inEuropeby creating attractive investment models.”

Both projects use turbines from Siemens, which last week announced plans to build two factories inYorkshire.

These latest investments form part of the GIB’s strategy to help offshore wind developers refinance so they can invest in the next round of projects. The bank also seeks to encourage other investors to follow.

SSE last week announced it is pulling out of four offshore wind projects, in a sign of the difficulties faced by the sector.

Maf Smith of Renewable UK said: “It’s great to see the Green Investment Bank moving in at an earlier stage of offshore wind development. Offshore wind requires a lot of capital up front, so investment at an earlier stage helps industry manage risk which in turn will help deliver cost savings to this sector.”