Northland Power to buy majority in 1 GW of RWE wind schemes off Germany

Sep 4, 2014 - Canada-based Northland Power Inc (TSE:NPI) has inked a deal to buy 85% stakes in three wind projects in the North Sea with a total capacity of about 1,002 MW from a unit of German utility RWE AG (ETR:RWE).

Northland and RWE Innogy GmbH said in a statement today that the Canadian power producer will take control of the 332-MW Nordsee One offshore wind project as well as of the Nordsee Two and Nordsee Three schemes, which approximate 670 MW in total. The financial terms of the deal were not revealed.

The EUR-1.2-billion (USD 1.6bn) Nordsee One project is well advanced, while the other two are in their early stages of development. All the three are mapped to the north of Juist Island in German territorial waters. The companies noted that the second and third wind farms will be developed over the next decade, when offshore wind tariffs are extended and the necessary grid infrastructure becomes available.

Nordsee One has already obtained the required permits and is expected to reach financial close in the first half of next year. The parties expect the tender process for the supply, installation and maintenance of the 54 wind turbines for the project to be finalised soon. In-water construction is seen to start in 2016 and the facility is anticipated to become operational by the end of 2017. It will have the capacity to produce more than 1,300 GWh of electricity annually, enough to satisfy the power needs of about 400,000 German homes. The plant will be receiving a fixed feed-in tariff (FiT) subsidy for ten years under the German Renewable Energy Act (EEG).

The acquisition of the majority stake in Nordsee One will expand Northland’s offshore wind portfolio to 642 MW.

(EUR 1.0 = USD 1.302)

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