Wind News

Tuesday 10 November 2009

Chancellor Alistair Darling said the funding was a "significant step forward" for wind energy

Up to £1.4 billion of European and commercial funding has today (November 10 2009) been made available for onshore wind projects in the UK.

With support from the HM Treasury and the Department of Energy and Climate Change (DECC), the European Investment Bank (EIB) will provide £700 million over the next three years, with the rest to be made up by three UK-based commercial banks - Lloyds Banking Group, RBS and BNP Paribas Fortis.

Loans will be made available to eligible projects costing up to £100 million and, while there is no set minimum cost, Jean-Christophe Chaline of the EIB claimed that projects would need to cost at least £20 million to receive funding under the scheme.

Speaking at the launch today, Chancellor Alistair Darling explained why the government was backing the scheme, and welcomed the EIB's support for the UK's onshore sector.

"We welcome the EIB's commitment to provide this vital funding for renewable projects across the UK. The money that is being made available will help continue the essential work of building the UK's capacity in renewable energy," he said.

Explaining that wind and tidal was an area of importance and that more must be done to increase generation in the sectors, he added: "What we see today is a significant step forward to make more money available for the development of wind energy which is very important and something we are committed to as a government."

Projects

The funding, which was originally proposed in April's Budget (See this NewEnergyFocus.com story), is aimed specifically at wind farms with planning permission with the EIB will providing up to 50% of the total capital costs of a project, with a loan term of 15 years.

The funding facility has been designed to support new builds and so cannot be used to refinance existing wind farms.

Energy and Climate Change secretary Ed Miliband also spoke at the launch event about the government's commitment to renewable energy. He said: "You can see from the Chancellor's presence the seriousness with which we take this issue. Seeing the green economy as part of the economy of the future is increasingly important."

Mr Miliband also noted that in order for the UK to hit its 2020 renewable target, the pace of wind energy installation needed to pick up.

He said: "We need to pull out the stops including making sure the capital is there to build the wind farms in the first place. This partnership of the EIB with RBS, BNP Paribas Fortis and Lloyds Banking group will address that problem. We are delighted that they are now on board to help make these projects happen."

EIB's European vice-president for the UK, Simon Brooks, added: "The EIB's contribution to transforming wind energy generation in the United Kingdom is a core element of our support for renewable energy technology across Europe.

"We are sure that targeted support, following UK and European Union policy combating climate change, will facilitate rapid and sustained investment in the industry and promote continued transformation to a low-carbon economy."

BWEA

Also speaking at the launch, chief executive of the British Wind Energy Association (BWEA), Maria McCaffery, declared that the association "whole-heartedly" supported the scheme.

She said: "Wind energy has never been a risky investment. In fact, wind farms in the UK have never defaulted on their loans. However, the recent turbulence in the financial markets has affected availability of loan finance for smaller and medium sized projects.

"The funds announced today will be particularly important role in bringing forward a host of sound projects, by developers with a proven track record in wind energy delivery."