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HgCapital reaches financial close for UK wind project

The private equity and renewable energy fund manager has closed the 20.5-megawatt Wandylaw project in the north-east of England, bringing the total value of renewable energy deals the firm has financed to more than €1.5bn.

HgCapital, through its portfolio company RidgeWind, has reached financial close on the 20.5 megawatt (MW) Wandylaw wind project in Northumberland in the north-east of England.

The London-based private equity and renewable energy investor has provided 100 percent of the equity for Wandylaw’s development and construction, while Royal Bank of Scotland acted as sole mandated lead arranger, agent and hedging bank for £36 million (€45 million; $57 million) in construction and term loan project financing.

Wandylaw, which was developed by UK wind farm developer RidgeWind, has 10 wind turbines and will sell power and renewable obligation certificates to Statkraft – the Norwegian renewable energy company – under a long-term contract. Construction at Wandylaw will start later this month, according to a statement from HgCapital, with the wind farm scheduled to become operational in early 2013.

Luigi Pettinichio, who led the financing of Wandylaw for HgCapital, hailed it as “an A-grade asset: built in a very windy site, with first-rate equipment and robust contractual structures”.

According to the same statement, HgCapital has now invested in more than 200 MW of UK onshore wind projects – either consented, in construction or operational – with an additional 300 MW-plus in development. The total debt and equity value of European renewable energy projects financed by HgCapital now exceeds €1.5 billion and more than 700 MW in wind, solar and hydro power.

HgCapital closed its second renewable energy fund in December last year on €542 million, beating a €500 million target. Its first fund had closed on €303 million in 2006.