3i Infrastructure closes UK transmission deal

The London-based firm’s £23m investment in the West of Duddon Sands OFTO project has reached financial close.

3i Infrastructure, the London-listed infrastructure arm of investment company 3i Group, has reached financial close on its £23 million (€32 million; $36 million) investment in the West of Duddon Sands offshore transmission owner (OFTO) project in the UK.

The deal, which sees 3i Infrastructure acquire a 50 percent holding in the project from Danish developer Dong Energy and Scottish Power Renewables (part of Spanish energy company Iberdrola), is also supported by an equity investment from Macquarie Capital.

3i Infrastructure and Macquarie were selected as preferred bidder following a competitive tender run by regulator Ofgem in July last year.

The project involves the acquisition, financing and operation of power transmission cables and associated electrical equipment connecting the West of Duddon Sands wind farm, located off Walney Island in the Irish Sea, to the UK electricity grid in Heysham, Lancashire.

The wind farm has 108 3.6-megawatt (MW) turbines with a total capacity of 389MW, providing renewable energy for more than 270,000 households per year.

“Our investment in this project represents another step in growing our portfolio of primary PPP and low-risk energy projects, delivering attractive risk-adjusted returns alongside our mid-market economic infrastructure investments,” said Peter Sedgwick, chairman of 3i Infrastructure, in a statement.