A 270-megawatt offshore wind project will begin rising up off British shores starting next year.
Final investment approval has paved the way for the Lincs project to get under way, according to Centrica plc, the parent company of British Gas. To be built at a cost of about £725 million, the offshore development will feature 75 3.6-megawatt Siemens wind turbines and is expected to being generating power toward the end of 2012.
Lincs will be locacated eight kilometres off the coast of Skegness next to Centrica’s existing wind farm developments at Lynn and Inner Dowsing. Once completed, it will bring Centrica’s equity interests in renewable energy projects to a total installed capacity of 650 megawatts.
The project was made possible through what The London Evening Standard called the “world’s biggest wind-power refinancing deal.” The deal will see Centrica selling a 50 per cent equity stake in its Lynn, Inner Dowsing and Glens of Foudland wind farms to the US-based investment management company TCW for a cash consideration of £84 million. Centrica will also agree to raise approximately £340 million of non-recourse project finance facilities from a consortium of banks for these assets.
Centrica is also entering into a joint venture agreement with TCW to govern their ongoing relationship as co-owners of the Lynn, Inner Dowsing and Glens of Foudland wind farms.
“The government’s enhanced financial framework for offshore wind has been fundamental in improving the overall project economics of this development,” said Sam Laidlaw, CEO of Centrica. “This is a milestone in our renewables strategy and we look forward to working together with TCW who bring significant global expertise in energy investments.”