Copenhagen Infrastructure Partners (CIP) announced that it has closed a non-recourse long-term project financing credit facility for the investment in Monegros, a large scale wind farm project. Monegros is part of Copenhagen Infrastructure III K/S (CI-III), a €3.5bn energy infrastructure fund managed by CIP.
The Monegros project consists of 12 onshore wind farms, with a total installed capacity of 487 MW, located in Aragon, Spain. The project already has power purchase agreements (PPAs) in place, entered into earlier this year to sell the majority of output generated by the wind farms for 10 years from the commercial operations date (COD), at a fixed price per MWh generated.
It is expected that the Monegros wind farms will sell approx. 12 TWh of renewable power under the PPA, making it the largest renewable power purchase agreement signed to date in Europe.
The €380 million financing was committed by a consortium of Spanish and European banks, including ABN AMRO, Bankia, Bankinter, BBVA, Sabadell and Unicredit. The financing consists of non-recourse long-term debt, available for drawdown upon the wind farms commencing commercial operations, while construction will continue to be funded solely with capital provided by CI-III. The funds will be used to refinance the costs incurred in the development and construction of each wind farm from the Monegros portfolio.
The financing has been independently validated as a Green Loan under the Green Loan Principles 2018. BBVA acted as structuring bank and green loan coordinator for the debt financing.
Christian Skakkebæk, Senior Partner at CIP, said:
“The closing of the Green Loan financing of Monegros on attractive terms marks another important milestone for our Monegros investment. This project matches our strategic focus on large scale renewable energy investments that can generate attractive and stable long-term returns for our investors. It is one of the largest market parity renewable energy investments made in Europe to date, demonstrating CIP’s ability to identify and execute projects that will contribute meaningfully towards Europe’s green transition. We would like to thank the lenders and the advisors involved for successfully completing this transaction, despite a challenging market environment.”
According to CIP, the construction phase is progressing well. Despite Covid-19 causing a challenging environment for construction activities in Spain, the wind farms remain on time and on budget. First power has been achieved and the wind farms will gradually reach COD within approximately 12 months. When in full operation, the portfolio is expected to generate approximately 1.5 TWh of renewable power annually, sufficient to meet the demand of approx. 430,000 Spanish households.
CI-III acquired the Monegros portfolio in development phase through two transactions in 2019 from Forestalia Renovables, the experienced Spanish developer that has continued to develop the portfolio in cooperation with CIP. The portfolio, comprising 12 wind farms in close proximity to each other, has 129 GE 3.8-130 wind turbines supplied and installed by GE Renewable Energy. GE Renewable Energy will also provide operational and maintenance services for the turbines under a long-term service agreement. The balance of plant (BoP) works is being executed by leading Spanish contractors Copsa, Elecnor and GES. Construction management is provided by Blue Power Partners and asset management will be provided by PeakWind. FIH Partners acted as financial advisor to CIP on the acquisition of the Monegros portfolio.