KKR seals first UK renewables investment

Scotland’s Srondoire Community Wind Farm is the first project to benefit from the £200m lending programme recently created by KKR, GIB and Temporis.

The Srondoire Community Wind Farm in Scotland will receive an £8 million (€10 million; $12.5 million) loan from the lending facility global investment firm Kohlberg Kravis Roberts & Co (KKR), the UK’s Green Investment Bank (GIB) and investment management firm Temporis Capital launched earlier this month, making it the first project to benefit from the programme, the New York firm said in a statement on Tuesday.

The loan, which also marks KKR’s first investment in the UK renewable energy sector, will be used to finance the installation of three turbines adjacent to what KKR billed as “one of the UK’s best-performing wind farms.”

Located in Argyll and Bute, Scotland, the wind farm is a joint venture between the Lithgow family of Ormsary and the Broadfoot family of Stronachulling, who have been living on and farming the land in Mid Argyll for over a century, according to the statement. The wind farm will be partly owned by the local community.

“Non-bank lending is becoming an increasingly important source of capital for many businesses and sectors,” said Nat Zilkha, co-head of credit for KKR. “We have deployed almost $5 billion globally via our different lending platforms. This is KKR’s first investment in the UK renewable energy sector as renewable power becomes a crucial part of the UK’s energy mix,” he commented.

While this represents KKR’s first investment in UK renewables, it is not the firm’s first investment in the sector. To date, KKR has invested in US, Mexico, Australia, France, Italy, Spain, Portugal and South Africa.

The lending programme, to which KKR and GIB will each be providing up to £100 million and which is being managed by Temporis, was created to provide funding for community-scale renewable energy projects in the UK.