Investment and advisory firm Blackstone has completed the financing for “Meerwind,” touted as the largest offshore wind farm in Germany.
Through WindMW GmbH, Blackstone wound up the deal with private investors to set out the wind project.
Meanwhile, Blackstone also announced the acquisition of a permit to construct the Nördlicher Grund, a 64 turbine wind farm with an estimated construction cost of €1.3 billion, which will be situated approximately 100 km off the German coast in the North Sea. Construction is expected to commence in 2013 with completion in 2016.
On the other hand, the 80-turbine wind farm will be located approximately 50 km off the German coast in the North Sea. Construction of the 288MW offshore wind farm will be completed in 2013. Once finished, Meerwind is expected to produce sufficient power to service approximately 400,000 households and will help Germany eliminate approximately one million tons of carbon emissions per year.
This is only the second German offshore wind farm to complete its financing and is the first to close under the recently unveiled Offshore Wind Programme, the KfW programme.
A group of seven commercial lenders, including Commerzbank, KfW IPEX-Bank, Bank of Tokyo-Mitsubishi, Dexia, Lloyds Banking Group, Santander and Siemens Bank together with EKF, the export credit agency of Denmark, and KfW-Bankengruppe, will provide total financing of €822 million for the project, with a total investment cost of €1.2 billion.
Blackstone said its affiliates, Blackstone Capital Partners VI L.P. and Blackstone Energy Partners L.P., will provide all of the project’s invested equity. The other partner in the project is Windland Energieerzeugungs GmbH, the project’s initial permit holder.
Since 2000, Windland has concentrated on offshore wind development and were the original developers of the project.
The investment funds the installation of 80 substructures (monopile foundations) with Siemens 3.6MW-120 wind turbines, the laying of infield cables, as well as the installation of the offshore high voltage substation. Grid operator Tennet TSO GmbH will undertake the connection to the main grid as per German law.
Peter Giller, WindMW Board Member, said: “The German government has demonstrated tremendous leadership in supporting private offshore wind development and we are pleased that Meerwind is the first project to reach financial close under the visionary KfW programme.
“With the development of Meerwind, we are able to support Germany in meeting it’s green energy targets.”
David Foley, Blackstone Senior Managing Director and CEO of Blackstone Energy Partners, added: “The German regulatory framework is well designed and essential to the development of the tremendous and as yet largely untapped resource that offshore wind represents.
“This project exemplifies the progress and positive impact on the economy that can be achieved when private capital works in partnership with government, entrepreneurs and industry.”
“The entry of new stakeholders into the offshore wind business will clearly boost the massive development of energy from the sea,” said Jens-Peter Saul, CEO of Business Unit Siemens Wind Power.”
“The BSH (Federal Maritime and Hydrographic Agency) welcomes this announcement which is a considerable milestone for the construction of this offshore wind energy project. By licensing projects such as “Meerwind” BSH supports a successful realization of this project in order to contribute to the renewable energy targets of the Federal Government of Germany,” said Christian Dahlke, responsible for Offshore Wind Energy at BSH.
WindMW was established in 2008 as a Blackstone portfolio company to develop German offshore wind farms. The Meerwind concession area is 50 km off the coast of Germany, Northwest of Helgoland. Meerwind first obtained the permit to build its wind park in 2007 from the Bundesamt für Seeschifffahrt und Hydrologie (BSH).
Advisors to WindMW included Green Giraffe Energy Bankers, KfW-IPEX and Dexia for financing, Gleiss Lutz for legalm matters, NWA for insurance, Ernst & Young for tax.
The lenders were advised by Watson, Farley & Williams (legal & tax), Sgurr Energy (technical), PKF (model audit), JLT (insurance) and IPA (power market).