Greencoat Renewables buys 50% stake in German wind farm

Energy company Greencoat Renewables is to acquire 50 per cent of the Borkum Riffgrund 1 offshore wind farm in Germany for about €350 million.

The group announced details of the purchase from Kirkbi A/S (31.5 per cent) and William Demant Invest A/S (18.5 per cent) on Monday. The wind farm was developed and built by Ørsted, which remains a 50 per cent shareholder.

Borkumm Riffgrund 1 is located in Germany’s exclusive economic zone in the North Sea and consists of 78 SGRE 4MW turbines that have been operational since 2015.

Ørsted will continue to provide operation, maintenance and management services to the wind farm under a long-term contract.

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The wind farm benefits from a fixed-price CFD [contract for difference] until September 2024. After this period, the project benefits from a government-backed floor price for the electricity sold until May 2035.

Greencoat would provide exposure to power price upside as well as the emerging European corporate PPA market opportunity.

The transaction is subject to regulatory clearance and is expected to close in the second quarter of 2022.

Greencoat Renewables investment manager Bertrand Gautier said the group was “very pleased” to enter the continental offshore wind market with a “significant strategic stake” in Borkum Riffgrund 1.

“This acquisition will contribute to Greencoat Renewables’ strategy to build a diversified portfolio of high-quality renewable electricity generation assets supported by strong contracted cash-flows and will support the company’s further expansion into continental Europe,” he said.

“The acquisition further strengthens Greencoat Renewables’ partnership with Ørsted and positions us well for future acquisitions in the European offshore sector.

“We believe that offshore wind is key in allowing governments to reach their decarbonisation objectives and we see a 63GW investment opportunity across our selected jurisdictions by 2030.”