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RDIF to finance Russia’s first offshore wind farm

The Russian sovereign vehicle has agreed to fund a 60MW project alongside Chinese firm Sinomek that will cost about $138m.

Russia’s sovereign wealth fund is set to finance the country’s first offshore wind farm after a deal was agreed in the Russian Republic of Keralia.

The Russian Direct Investment Fund pledged to co-finance the 60MW project alongside the China Civil Engineering Construction Corporation. The pair said that the project is forecast to cost about 9 billion rubles ($138.3 million; €130.6 million) and expected to be operational by 2020.

The deal provides a fillip to the Russian wind industry, which remains at a relatively immature stage with under 200MW in operation. The sector is set to receive another boost next year when Finnish utility Fortum will begin construction on a 35MW onshore project in Ulyanovsk.

“Wind power generation is just beginning to develop in Russia,” said Alexander Khudilainen, head of the republic. “In fact, Karelia is the second region after the Ulyanovsk region, which will soon launch a similar project.”

The deal marks the second time RDIF and CCECC team up on a renewable energy project. Last year they agreed to develop two small hydropower plants each with a capacity of 24.9MW. Debt providers for the two assets, worth 11.8 billion rubles, included the New Development Bank, the International Investment Bank and the Eurasian Development Bank.

RDIF has $10 billion of reserved capital under management. Last week, it was part of a consortium that agreed to acquire Vladivostok Airport, one of Moscow’s three hubs.