Dong Energy Secures Funding for World's Largest Windfarm

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Written by Martin Lynch, European News Editor for Industrial Info (Galway, Ireland)--Dong Energy A/S (Fredericia, Denmark) has secured a £250 million ($370 million) loan from the European Investment Bank (EIB) (Kirchberg, Luxembourg) to start building the world's largest offshore windfarm.

The money will be used to finance the London Array windfarm in the Thames Estuary in England, which will have a total generating capacity of up to 1,000 megawatts (MW), enough to power approximately 750,000 homes.

The loan with the EIB has been guaranteed by the Danish Export Credit Agency (Eksport Kredit Fonden, EKF) on the basis of deliveries from Siemens Wind Power and Per Aarsleff.

The windfarm will be constructed in two phases on a 245-square-kilometre site. Phase I, occupying a 100-square-kilometer site with a proposed 175 Siemens SWT-3.6 turbines, will kick off in 2011 and will be operational in 2012, in time to provide electricity for the London Olympics, according to Dong. The first phase will provide a generating capacity of 630 MW, and Phase II will increase the capacity to 1,000 MW.

"Dong Energy's goal is to reach at least 3,000 MW of wind turbine capacity by 2020, and London Array is a cornerstone in this transition towards a greener future," commented the chief financial officer of Dong Energy, Carsten Krogsgaard Thomsen. "The EKF-guaranteed EIB funding of the project supports our robustly financed investment programme."

Simon Brooks, the European Investment Bank vice president responsible for operations in the United Kingdom, said: "The European Investment Bank is pleased to be able to support Dong Energy's contribution to London Array, expected to be the world's largest windfarm. This project will make a significant contribution to the United Kingdom's renewable energy targets."

The London Array consortium consists of Dong with a 50% share, German power and gas company E.ON AG (OTC:EONGY) (Dusseldorf, Germany) with a 30% share and the final 20% controlled by Abu Dhabi Future Energy Company (Masdar) (Abu Dhabi, United Arab Emirates).

Last December, the consortium awarded six major contracts, totalling almost 2 billion euros ($2.45 billion), to seven European suppliers. The largest contract to date is worth approximately 1 billion euros ($1.23 billion) and was awarded to Siemens Transmission and Distribution Limited (Manchester, England), a subsidiary of Siemens AG (NYSE:SI) (Munich, Germany). The contract covered the supply of the 175 turbines needed to complete Phase I. For related news, see December 21, 2009, article - London Array Consortium Awards Six Major Contracts Worth 2 Billion Euros.

The EIB has been getting more active in the wind and renewable energy sector in the past year. In November, the investment bank announced that it was considering offering £300 million ($443 million) to fast-track the connection of U.K. offshore windfarms to the country's national grid. The money will be made available for six projects, which collectively will connect about 1.6 gigawatts (GW) of offshore generation. For related news, see November 4, 2009, article - U.K. Offshore Windfarms Given £300 Million Boost.

IIR's Renewable Energy Database provides extensive coverage on the Wind Energy, Geothermal, Hydroelectric, Landfill Gas-to-Energy and Utility-Scale Solar power plants throughout North America, and is now expanding coverage across the world.

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