The Green Investment Group has teamed up with GE to buy a 650MW onshore wind farm in Sweden in a deal worth €800 million.
The Markbygden ETT project has been bought from local developer Svevind and will be the largest single-site wind farm in Europe once it has completed construction by the end of 2019.
The GIG and GE Energy Financial Services, acting as equal partners, have invested about €300 million of equity into the project. The pair have also raised €500 million in debt financing from the European Investment Bank, Germany’s Export Credit Guarantees, NordLB, KfW IPEX-Bank and HSH Nordbank. The EIB had earmarked up to €375 million for the site earlier this year.
GIG and GE have agreed a 19-year power purchase agreement for the wind farm, with the contract supplying power to Norwegian aluminium company Norsk Hydro’s plants. The agreement will begin in 2020 after a current contract with Statkraft expires. The GIG said the PPA is the largest corporate wind energy PPA in the world.
“This project is a landmark transaction on many fronts and represents the new frontier in European onshore wind,” said Edward Northam, head of the Green Investment Group in Europe. “It demonstrates that in the right market, with the right location, the right technology and the right partners, it is possible to develop and attract private capital into new onshore wind farms.”
The deal is the second recent investment by the former Green Investment Bank outside of the UK since Macquarie bought the vehicle earlier this year. Last month, it partnered with UK-based solar developer Lightsource to invest in projects in India through its UK Climate Investments programme. It is the GIG’s third investment overall after it acted as one of the debt providers to a 70MW waste facility in the UK in September.