All Systems Go for $1.5 Billion North Sea Offshore Windfarm

Written by Martin Lynch, European News Editor for Industrial Info (Galway, Ireland)--The 1.3 billion euro ($1.5 billion) Deutsche Bucht (DeBu) offshore wind project in the German North Sea looks set to sail after new owner Northland Power Incorporated (OTC:NPIFF) (Toronto, Ontario) announced that the project has reached financial closure.

The Canadian company, which acquired the project earlier this month, said that "all of the equity contributed to the project and all debt required for the project is now fully committed by the project lenders". Northland owns 100% of the 252-megawatt (MW) offshore windfarm, its third North Sea wind project, which is located 77 kilometres (km) from its other German offshore wind project, Nordsee One.

Around 75% of the project's required costs will be supplied by a group of 10 international commercial lenders, and Northland said that the project's financing was oversubscribed. DeBu is expected to generate enough clean energy to meet the needs of more than 178,000 households and will reduce CO2 emissions by more than 360,000 tonnes per year, the company said. Once completed, it will receive a fixed feed-in tariff subsidy for approximately 13 years under the German Renewable Energy Act (EEG). This will equate to approximately 184 euro ($216) per megawatt hour for eight years and 149 euro ($175) per megawatt hour for the remainder.

"Today's announcement represents an important milestone for Northland's offshore wind strategy," said John Brace, chief executive officer of Northland. "In only a few years, Northland has become a leader in European offshore wind, as demonstrated by our 100% ownership of this high-quality project. We would like to thank the project's financiers and advisors for their thoroughness and proficiency. This achievement is another example of Northland's commitment to delivering sustained growth and exceptional results."

Northland has also signed a contract with MHI Vestas Wind Systems A/S (OMX:VWS) (Aarhus, Denmark) to supply 31 of its V164-8.0 MW wind turbines rated at 8 MW each, alongside a long-term servicing contract. Jens Tommerup, chief executive officer of MHI Vestas Offshore Wind, said: "The order affirms the strength of the V164-8.0 MW as a very competitive turbine for the German market, where distance from the coast and deeper waters demands a larger and more powerful machine."

In May, Industrial Info reported that Northland had completed the construction of its 600-MW Gemini offshore windfarm in the Dutch North Sea. For additional information, see May 10, 2017, article - Full Power for 600-Megawatt Dutch Offshore Windfarm.

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