innovative funding
Daan Dijk
Offshore wind farming
Although only 1% of all fuel produced world-wide
is currently biofuel, this fïgure is growing rapidly.
'Both Europe and the United States have bio-di-
rectives in place calling for increases in the use of
biofuels by 2010,' Dijk explains. 'In Europe, biofuel
currently represents only 2% of total fuel sales, but
this fïgure should increase to 5.75% by 2010. In
the United States, they're aiming for 10% by 2010.
In addition, the solar energy sector is growing
at a rate of 40% per annum. It's getting cheaper
and more efficiënt and, in many cases, is already
economically viableforend users.'
'Renewable energy is big business,' Dijk concludes.
'It's also a fast-growing business and a good
business to be in, because it's the right thing to
do. And we shouldn't forget that it's also a
farming business.'
Rl, together with Dexia and Eksport Kredit
Fonden (EKF), has closed the financing for the
construction and operation of an offshore wind
farm in the Q7 region of the North Sea, off the
Dutch coast near IJmuiden. 'Offshore wind energy is an up-and-coming
market, particularly in Western Europe, where we're looking at opportuni-
ties in the North Sea and the Baltic,' says Niels Jongste from RI's Structured
Finance department. 'We knew the original investors who took over the
project in 2004, but there were quite a few other banks in competition
with us. Rabobank was eventually chosen as the lead financier because of
our experience with onshore wind farms in Europe.'
The Q7 wind farm will have a capacity of 120 megawatts, produced by 60
Vestas V-80 wind turbine generators. The 379 million project is being
developed for ENECO Energie, Econcern and Energy Investment FHoldings.
Construction began in May 2006 and is scheduled for completion by March
12008. The production of approximately 400 GWh per year will be enough
to supply 125,000 Dutch households.
The Q7 wind farm is the Netherlands' second offshore wind farm and the
first in the world to make use of non-recourse financing. 'Non-recourse
financing means that the sponsors/shareholders are not liable for the bank
debt if, for any reason, the project cannot be completed or underperforms
during its operational phase,' Jongste explains. The bank is only entitled
to seize the project assets and sell them off or run the project itself. This
entails a certain degree of risk, of course, but we were comfortable with the
shareholders, the construction companies and our own ability to identify
and mitigate the risks sufficiently. The offshore wind energy market could
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The Word
