Masdar Secures $424 Million for Largest Offshore Wind Farm

Masdar Energy U.K., a unit of Abu Dhabi’s state renewable energy developer, secured 266 million pounds ($424 million) in loans to finance its share of London Array, the world’s largest offshore wind farm.

Bank of Tokyo-Mitsubishi UFJ Ltd., KFW-IPEX Bank, Siemens Bank GmbH, and Sumitomo Mitsui Banking Corp. contributed to the refinancing, Masdar said today in a statement. The U.K. Green Investment Bank Plc also provided a 58.6 million-pound loan.

The deal may boost Britain’s efforts to lure investors to its offshore wind industry as it seeks to attract 110 billion pounds to replace aging power plants and upgrade the grid. The U.K. must get about 30 percent of its power from renewables by the end of the decade to meet a European Union goal. It generated 15.5 percent from clean energy in the second quarter.

“While the London Array financing is a great success, it is critical to the future of the renewable energy industry that we see a deepening level of engagement from the financial sector,” said Sultan Ahmed Al Jaber, Masdar chief executive officer. “We need increased collaboration between institutional investors and the renewable energy industry to drive down cost and accelerate adoption.”

Refinancing Plan

London Array, in the outer Thames Estuary off the Kent coast southeast of London, supplies enough power for 500,000 U.K. homes a year after its final turbine was connected in March. The 12-year loan announced today refinances Masdar’s 20 percent share in the 630-megawatt venture. It will reinvest the freed capital into U.K. offshore wind.

Dong Energy A/S of Denmark owns 50 percent and Germany’s EON SE has the remaining 30 percent share in the 2.2 billion-euro ($2.98 billion) project.

“The U.K. Government has ambitions to go further and to see the development of new projects,” Green Investment Bank chief executive officer Shaun Kingsbury said in a statement. “For that to happen it is important that those best placed to take early stage development and construction risk can get their money out of operating assets and reinvest it.”

Britain plans to install about 18 gigawatts of offshore wind by 2030, according to a scenario released by the government in July. The U.K. has been at the forefront of the world’s offshore wind industry since 2008 and has 3,653 megawatts of turbines installed around its shores.

Further terms were not immediately available when Masdar was contacted by phone.

To contact the reporter on this story: Sally Bakewell in London at sbakewell1@bloomberg.net

To contact the editor responsible for this story: Reed Landberg at landberg@bloomberg.net

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