Feb. 8 (Bloomberg) -- A UniCredit SpA, KfW Ipex-Bank GmbH and Bremer Landesbank-led group will finance a 1.4 billion-euro ($1.9 billion) German offshore wind farm, suggesting projects are beginning to overcome recent obstacles to raising funds.
Nine commercial lenders, the European Investment Bank, Germany’s state-run KfW Group and Denmark’s Eksport Kredit Fonden provided 937 million euros of loans to the Butendiek project, UniCredit and KfW said today in separate statements. Siemens AG, Europe’s biggest engineering company, won a 700 million-euro order to supply turbines to the North Sea farm.
German Chancellor Angela Merkel’s offshore wind ambitions are at the heart of plans to triple the share of renewables in the country’s power mix by 2050 as it exits nuclear. The plans faltered as RWE AG delayed investments because of concerns it would bear financial risks and the power grid needed improving. Turbine maker REpower Systems SE also reduced temporary staff.
“The conclusion of this financing is a clear signal to the market,” KfW Group Chief Executive Officer Ulrich Schroeder said in the company’s statement. “The show will go on.”
Other banks include BayernLB Holdings AG, Helaba Landesbank Hessen-Thueringen Girozentrale, HSH Nordbank AG, ING Groep NV, Rabobank International and Skandinaviska Enskilda Banken AB, the EIB said. The Luxembourg-based lending arm of the European Union loaned 450 million euros, and KfW a total of 239 million euros.
Construction at the farm 32 kilometers (20 miles) west of the German North Sea island of Sylt will start early next year, with commissioning of turbines due in 2015. Once operational, it will provide enough power for about 370,000 homes, according to the EIB. Siemens will supply 80 of its 3.6-megawatt turbines and related services, the company said today in another statement.
Remaining money for Butendiek will come from investors such as pension administrator PKA A/S, retirement fund Industriens Pensionsforsikring A/S, the Marguerite Fund, Siemens Project Ventures GmbH and the project’s developer WPD AG of Germany.
Marguerite, an EIB-backed fund, said it acquired 22.5 percent of the 288-megawatt project and the pension funds and Siemens did the same, leaving Bremen-based WPD with 10 percent.
“This is an important signal for the German offshore market and also for the successful further development of our company,” Gernot Blanke, chief executive officer at WPD, said in a statement on its website. UniCredit and KfW declined to provide further information when contacted by Bloomberg.
To contact the reporter on this story: Sally Bakewell in London at email@example.com