- UK Green Investment Bank acquires 25% stake in Galloper offshore wind farm
- The project is a joint venture between GIB, project developer RWE Innogy, Siemens Financial Services and Macquarie Capital
- It is the UK’s first construction-ready offshore wind project finance deal
- Galloper is expected to generate enough renewable energy to power around 330,000 homes annually and reduce greenhouse gas emissions by more than 190 kt CO2e per annum, the equivalent of removing 85,000 cars from the road.
UK Green Investment Bank plc (GIB) has today joined Siemens Financial Services, Macquarie Capital and project developer RWE Innogy as 25% joint equity partners in the £1.5bn Galloper offshore wind farm.
The joint venture has also secured £1.37bn of debt facilities from a consortium of 12 commercial banks plus the European Investment Bank (EIB), making it the UK’s first construction-ready offshore wind project finance deal.
This is the first UK project to be backed by the European Fund for Strategic Investments (EFSI), a new initiative expected to support €315bn of infrastructure and SME investment across Europe over the next four years. EFSI was established earlier this year by the EIB and the European Commission and will enable increased lending for crucial projects by the EIB.
Construction of the 336 MW wind farm, which is expected to qualify for Renewables Obligation Certificates, will commence next month. Once complete, it is expected to generate enough renewable energy annually to meet the electricity needs of around 330,000 homes.
The development is also expected to reduce greenhouse gas emissions by more than 190 kt CO2e per annum, the equivalent of removing 85,000 cars from the road.
Galloper will be located 27 km off the Suffolk coast. Around 700 jobs will be created during the construction phase, with up to 90 jobs being created in operations and maintenance once construction is complete.
This is GIB’s eighth investment in the UK’s offshore wind sector. The GIB has helped mobilise more than £5bn in cumulative capital for offshore wind projects in the UK that, once operational, will provide nearly 3,000 MW of renewable electricity generation capacity – enough to power more than 2.3 million homes in the UK.
Energy Minister Andrea Leadsom said:
This is fantastic news for the region and the whole of the UK, reflecting the fact that we are open for business and the best place in the world to invest in offshore wind. This milestone shows how the UK’s offshore wind industry is going from strength to strength.
Ed Northam, Head of Investment Banking, UK Green Investment Bank, said:
This is another significant milestone in the development of the UK offshore wind industry in a year that has already seen two major projects come online and construction commence on another. The transaction reinforces our relationship with RWE and further highlights the impressive list of companies that are investing in the sector. It is the second investment in offshore wind that GIB has made at FID in the space of six months, demonstrating the role that we continue to play in making sure that complex, but important, green infrastructure projects can proceed.
Hans Bünting, CEO of RWE Innogy, said:
We welcome GIB, with their experience of supporting renewables ventures and their substantial knowledge of offshore wind financing, back to another offshore partnership, their first ever equity investment being a stake in our Rhyl Flats project. Together with all of our partners, we look forward to utilising our collective experience and expertise to realise the successful construction of the Galloper wind farm.
Notes to editors
About the UK Green Investment Bank
UK Green Investment Bank plc (GIB) was launched in November 2012. With £3.8bn of funding from the UK Government, it is the first bank of its kind in the world. It is a “for profit” bank, whose mission is to accelerate the UK’s transition to a greener economy, and to create an enduring institution, operating independently of Government.
GIB is wholly owned by HM Government. The Company is not authorised or regulated by the Financial Conduct Authority or the Prudential Regulation Authority. A wholly owned subsidiary UK Green Investment Bank Financial Services Limited, is authorised and regulated by the Financial Conduct Authority.
About RWE Innogy
RWE Innogy pools the renewable energy expertise and generating plant of the RWE Group. RWE Innogy is fully committed to growth in renewable energy across Europe and the UK continues to play a significant role. Earlier this year RWE Innogy UK inaugurated the world’s second largest offshore wind farm, Gwynt y Môr, off the coast of North Wales. RWE Innogy UK is a sister company to RWE npower, a leading UK energy company.
About Siemens Financial Services
Siemens Financial Services (SFS) provides business-to-business financial solutions. SFS helps facilitate investments, providing commercial finance, project and structured finance with specific asset expertise in the growth fields of electrification, automation and digitalization.
Employing more than 3,000 employees worldwide, SFS supports Siemens as well as other companies with their capital needs and acts as an expert manager of financial risks within the Siemens company.
About Macquarie Capital
Macquarie Group is a global provider of banking, financial, advisory, investment and funds management services. Founded in 1969, Macquarie operates in more than 65 office locations in 28 countries and employs more than 14,000 people. Assets under management total approximately €345 billion at 31 March, 2015.
Macquarie Capital is the advisory, capital markets and principal investment arm of Macquarie Group. Macquarie Capital provides strategic M&A and capital raising advice as well as partnering with clients to provide capital to facilitate transactions through equity co-investment and lending, including working closely with contractors, developers and utilities in the construction of greenfield infrastructure projects.
Macquarie Capital has a strong track record of principal investing alongside clients having invested approximately £1.4 billion in 100 deals globally across a range of industries, structures and jurisdictions since 2008.