• Lincs Masthead

      

    The UK is the global leader in offshore wind energy with installed capacity equal to that of the rest of the world combined.

    There are 568 operational offshore turbines in the country’s waters totalling 1,858 megawatts (MW) and a further 665 in construction amounting to 2,359MW.

     

    Infrastructure developers continue to construct and extend round 1 and 2 wind farms throughout Crown Estate waters, while others seek planning consent on larger round 3 projects, which will be constructed over the coming years and greatly expand the UK’s offshore energy output.

     

    Changing tide 

    The 270MW Lincs wind farm is located five miles from the Lincolnshire coast and will comprise 75 Siemens turbines generating enough power to supply the annual electricity requirement of approximately 200,000 homes. Preparatory construction for the wind farm began in April 2009 and the project is due for completion in the first half of 2013.

     

    In June 2010, having obtained a contract for an offshore electrical substation, contractor Siemens began installing onshore to offshore cables. Construction of the offshore assets of the wind farm started in earnest in 2011.

     

    Centrica plc, the global integrated energy company, acquired the Lincs wind farm project in 2004; obtaining planning permission in 2008.The sponsor currently has four operational wind farms in the UK. In December 2009, DONG Energy and Siemens Project Ventures GmbH jointly acquired 50 per cent of the project from Centrica, which retained the remaining 50 per cent.

     

    The funding climate 

    Lloyds Bank’s Infrastructure and Energy Finance team has a strong track record in this strategically important sector, having provided £445m to finance renewable projects since the beginning of 2011.

     

    This consistent support saw us ranked as the leading lender in Bloomberg’s renewable energy Mandated Lead Arranger (MLA) league table between January 2011 and June 2012.

     

    We acted as joint MLA in providing a facility in excess of £420 million as part of a nine bank club for this landmark transaction. The deal represented the largest offshore UK wind project to be bank funded and the first in the country to secure finance whilst under construction, according to Bloomberg New Energy Finance.

     

    Additional roles in the deal included Facilities Agent, Account Bank, Security Trustee, Letters of Credit Issuance Bank, Offshore Transmission Network Owner (OFTO) Working Group Bank, and Market Execution Bank for Interest Rate and FX Hedging, drawing on the expertise of teams across the wider Lloyds Banking Group.

     

    The sponsors recognised our expertise in structuring complex deals in the renewable energy sector and, specifically, the offshore wind space, alongside our ability to provide an integrated proposition to ensure timely execution and delivery of various structural elements.

     

    A landmark deal with future implications 

    Richard Simon-Lewis, Senior Director, Infrastructure and Energy Finance at Lloyds Bank, says: “As a leading renewable energy funder, we’re committed to supporting developments in technology and, over the past five years, have backed over 45 renewable energy deals. This is equivalent to over 6,000MW of renewable energy generation – enough to supply more than three million homes.

     

    “Despite the challenging market environment, well-structured projects that are backed by strong relationship sponsors continue to receive the finance required and Lincs will provide an important precedent for follow-on Round 3 projects.”

     

    Ian Johnson, Chief Finance Officer of Lincs, commented: “We are delighted to have worked with the team on this ground breaking deal for the UK offshore wind farm industry.”

     

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7/21/2019 10:27:53 PM