EIP to Invest in Iberdrola’s Wikinger Offshore Wind Farm
Energy Infrastructure Partners (EIP), a leading infrastructure investor focused on the global energy transition, has reached an agreement on behalf of its clients to take a 49% stake in Iberdrola’s first operational offshore wind farm in Germany – the Wikinger offshore wind farm. The value of the transaction is EUR 700 million, Iberdrola announced. Following the transaction, Iberdrola will remain a majority owner with 51 percent in the German offshore wind farm.
According to the agreement, Wikinger’s total valuation amounts to approximately EUR 1.425 billion. Iberdrola will continue to control and manage this asset, leading the operations and maintenance services.
Wikinger operates under Germany’s feed-in tariff regime, which the country launched to spur clean energy investments and has since closed to new projects. The scheme offers a guaranteed price for all electricity produced by the Wikinger wind farm through 2037.
Unlike other fixed-price offtake arrangements, the wind farm and other assets in the scheme can sell the power they produce at market prices whenever they exceed the tariff.
Partnership with global leader in the renewable energy movement
Iberdrola, a Spanish multinational leader in clean energy and a pioneer in the deployment of smart grids, entered the German market by building Wikinger, which began operations in 2018. Germany has since become a focus market for the Spanish multinational, which has built more than two decades of experience in renewable energy and is on track to amass 60 gigawatts of installed carbon-free generation capacity globally by 2025.
“Opportunities to join global leaders like Iberdrola as investment partners in a wind farm of this calibre – and with access to one of the most attractive regulatory schemes in the world – do not come around that often,” said Roland Dörig, EIP’s co-founder and managing partner. “It’s an especially proud day for our investors and another important moment in our growth story.”
Leveraging expertise in offshore wind
“It’s an honour to partner with Iberdrola, a pioneer and undisputed leader in the offshore wind industry,” said Peter Schümers, EIP’s co-head of Investments. “Adding a second offshore wind farm in the Baltic Sea allows us to continue leveraging our expertise with this technology while enhancing diversification across our clients’ portfolios.”
Since it entered operation, Wikinger’s 70 turbines have contributed 350 megawatts in capacity of carbon-free electricity to Germany’s green energy ambitions, enough to power about 350,000 German homes, according to an Iberdrola analysis.
EIP manages a stake in the adjacent Arkona wind farm with 378 megawatts of capacity in partnership with RWE AG following a 2020 investment.
Iberdrola, a firm commitment to offshore wind
Iberdrola, chaired by Ignacio Galan, is a world leader in offshore wind power. Wikinger is one of the company’s flagship operational projects and was the first offshore wind farm developed by the group on its own. With an installed capacity of 350 megawatts (MW) it has been supplying clean energy to approximately 350,000 German households since it was commissioned in 2018.
Iberdrola reaffirms its commitment to offshore wind, with almost 1,300 MW of offshore capacity in operation by the end of June 2022. In addition, it has 3,000 MW under construction, another 4,000 MW secured and an extensive project pipeline under development.
Elsewhere, the group has two offshore wind farms in operation: West of Duddon Sands, and East Anglia One commissioned in 2017 and 2020 respectively and located in the UK.
In the United States, Iberdrola group has begun construction of the country’s first commercial-scale offshore wind farm: Vineyard Wind. Located off the coast of Massachusetts, its 800 MW capacity will meet the energy needs of 1 million homes. In total, Iberdrola has approximately 5,000 MW of offshore wind projects under development in the United States, including Park City Wind with 804 MW and Commonwealth Wind with 1,232 MW.
In Germany, the group has started construction of 476-MW Baltic Eagle project in the Baltic Sea. Next year, construction will begin on Windanker, which will have a capacity of with 308 MW.
These new wind farms will be joined by Saint-Brieuc, in French waters, which is expected to come into operation in 2023. It will have a capacity of 496 MW and will be located off the coast of Brittany, 20 kilometres offshore.
Iberdrola’s global offshore wind pipeline includes a wide range of projects at different stages of development in countries such as the United Kingdom, the United States, Ireland, and Sweden, along with an expanding portfolio in countries such as Japan, Taiwan, the Philippines, and South Korea.
About Energy Infrastructure Partners
Energy Infrastructure Partners AG is a Switzerland-based manager of collective assets focused on long-term equity investments in high-quality, large-scale renewables and system-critical energy infrastructure assets. Their strategy and investment horizon align with the lifetime of the underlying assets and generate visible cash flows. With over CHF 5 billion under management, EIP leverages an extensive industry network, broad transaction experience and partnerships with leading energy companies and the public sector to develop and manage investment solutions for institutional investors globally. EIP’s investor base includes pension funds, insurance companies and large family offices, who are increasingly interested in contributing to security of the energy supply as a pathway to create positive economic, ecological, and social developments, and whose long-term funding needs closely match the energy infrastructure asset class.