PensionDenmark Invests in Wind Farm Offshore Nantucket

PensionDanmark has pledged $200 million in funding for a wind farm in Nantucket Sound, in the first committed investment in Cape Wind Associates LLC’s proposed 468-megawatt park offshore Cape Cod.

The Danish pension fund, with $26 billion under management, is providing the investment as a mezzanine loan. The $2.6 billion project has encountered opposition from residents in affluent Nantucket, Massachusetts, members of the Kennedy family and the Wampanoag Tribe of Gay Head. It will be the first offshore wind park in the U.S., the Copenhagen-based pension fund said late yesterday in a statement.

“Investing in energy infrastructure is not new to us,” Chief Executive Officer Torben Moger Pedersen said. “At a time when bond yields are very low, this is expected to be an attractive investment opportunity for us.”

The fund plans to invest an additional $2.2 billion in wind energy and other infrastructure assets over the next four to five years after plowing $1.1 billion into investments such as three U.S. onshore wind parks and two Danish offshore park.

The investment is an “important milestone” said Jim Gordon, founder and owner of Boston-based Energy Management Inc., the parent of Cape Wind. The project has been 12 years in the making after encountering opposition from some residents, who cited concerns of the effects on the local fishing industry.

PensionDanmark said its investment is conditional on a final decision this year to construct the farm, which may have as many as 130 Siemens AG (SIE) 3.6 megawatt turbines. The first phase includes construction of 101 turbines. Barclays Plc (BARC) is advising Cape Wind on raising the remaining financing, the developer said in a statement in March.

To contact the reporter on this story: Peter Levring in Copenhagen at plevring1@bloomberg.net

To contact the editor responsible for this story: Jonas Bergman at jbergman@bloomberg.net

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