Macquarie Capital makes biggest investment in Australian renewables

Its equity financing for the 226MW Murra Warra wind farm in Victoria represents the firm’s first major foray into the country’s wind energy space.

Macquarie Capital is providing equity financing for the 226MW Murra Warra Wind Farm project in Victoria, making it the firm’s largest investment in Australia’s renewables sector to date.

Together with the equity financing provided by renewable energy company RES, stage one of the wind project, which comprises 61 turbines, has reached financial close, enabling construction to begin.

Stage one is expected to be completed and fully operational by mid-2019, generating enough clean electricity to power 220,000 homes each year and reducing carbon emissions by roughly 900,000 tonnes annually, according to RES.

The company declined to comment on the value of its and Macquarie’s equity commitment, but Tanya Jackson, an RES spokeswoman, told Infrastructure Investor that it viewed Macquarie’s involvement as a “significant and positive contribution to the market”.
Macquarie Capital declined to comment.

In addition to the equity financing, RES had previously secured debt financing of approximately A$320 million ($251.3 million; €203.4 million) from a consortium comprising ANZ, the Bank of Tokyo-Mitsubishi UFJ, Sumitomo Mitsui Banking Corporation and Westpac Banking Corporation.

Last December, the Murra Warra project secured long-term power purchase agreements with a consortium of corporations and large energy users led by Telstra and including ANZ, Coca-Cola Amatil and the University of Melbourne – making it the biggest renewable energy project to date, enabled by private buyers, and part of a wider trend.

“We expect that corporate PPAs will become a much more common feature of the Australian market and Murra Warra is certainly part of this overall trend,” Jackson said.
Macquarie Capital and RES have further committed to developing stage two of the project, consisting of 55 turbines with a rated capacity of 203MW, taking the total capacity of the scheme to 429MW through 116 turbines once completed.

Macquarie Capital, the corporate advisory and principal investment arm of Australia’s Macquarie Group, has a track record of investing in renewable energy around the globe. Since 2011, it has invested approximately $A2.5 billion across solar, wind (onshore and offshore) biomass, waste-to-energy, and battery storage.

Last August, a consortium led by Macquarie Group, and Macquarie European Infrastructure Fund 5 – a fund managed by Macquarie Infrastructure and Real Assets – acquired, alongside the Universities Superannuation Scheme, the UK Green Investment Bank for £2.3 billion ($3.2 billion: €2.6 billion).