Funding first for new ‘largest’ wind farm

The opening was conducted by Edward Davey, Secretary of State for Energy and Climate Change, accompanied by Deputy Prime Minister Nick Clegg.For Mr Davey, it has been a case of in at the deep end after he took over the role just days after the resignation of previous secretary, Chris Huhne.

Near the top of Mr Davey’s in-tray will have been the letter to the prime minister, from more than 100 members of parliament, calling for a dramatic cut in subsidies for onshore windfarms. Mr Clegg was quick to respond, stating, “The choice for the UK is simple: wake up or end up playing catch up. In today’s world, the savviest states understand that going for growth means going green. Low-carbon markets are the next frontier in the battle for global pre-eminence. I want the UK to be the number one destination for green investment. We’re in this race to win it.”

The coincidental timing of these events with the Walney opening has, however, allowed what has clearly been a success story for offshore wind to do the talking. Walney (UK) Offshore Windfarms Ltd is a JV between DONG Energy, SSE and OPW.

The two phases of Walney wind farm, off the coast of Barrow-in-Furness, Cumbria, comprises 102 Siemens 3.6MW turbines with a total capacity of 367MW, the project setting a number of industry records. The second phase, Walney 2, was constructed in the fastest time ever for an offshore wind project, with all turbines and cables installed in just five months and 13 days, setting a record for the sector. DONG Energy considers this an important step for offshore wind and the drive towards further industrialising the industry. Approximately 60 jobs will be created at the new control centre at Barrow-in Furness, which will oversee all aspects of the windfarm’s operation and maintenance over its lifetime.

The question of financing is a subject currently focussing the minds of the burgeoning offshore wind industry and Walney is described as ‘ground breaking’ in its financing arrangement. It is the first UK offshore wind farm to receive investment from a pension fund service provider and an equity fund before it was even built. Walney JV partner OPW, is a consortium of the Dutch pension fund service provider PGGM and Ampere Equity Fund, and took a 24.8% stake in the project in December 2010.

The partnership is managed by Triodos Investment Management and DONG Energy states that this aspect of the project clearly demonstrates that institutional investors are willing to invest in well structured, offshore wind projects alongside market leading industry participants.

By Peter Barker