The UK Green Investment Bank (GIB) has so far raised £818m for its offshore wind fund, the government-owned bank announced today.
The bank said that it had executed a second close on new commitments of £355m for the offshore wind fund, bringing the total amount raised to £818m after a £463m initial close earlier this year.
The bank has set a £1bn fundraising target for the fund, which is expected to be the first of its kind dedicated entirely to investments in offshore wind power generation.
Major investors in the latest round of fundraising included the Swedish life insurance and pension company AMF Pensionsforsakring and the UK-based Strathclyde Pension Fund.
The bank also announced that the fund acquired GIB’s option on a 10 per cent stake in Gwynt y Mor wind farm located off the North Wales coast. The farm is reportedly the second-largest operating offshore wind farm in the world.
Gwynt y Mor becomes the fund’s third asset, alongside the Rhyl Flats wind farm in North Wales and the Sheringham Shoal wind farm off the coast of Norfolk.
The bank said combined, the three offshore wind farms are able to produce 2,980 GWh of renewable energy annually, enough to power more than 700,000 homes.
Energy secretary Amber Rudd applauded the announcement today, saying: “Offshore wind has been a UK success story and I welcome this long-term, private sector involvement in what is now the largest renewable energy fund in the UK.”
Karl Smith, GIB’s fund managing director, said the fundraising round “highlights the growing confidence that home-grown and international investors have in well-developed and well-managed offshore wind assets in the UK”.
Smith said the bank is “in advanced discussions with other potential investors” and “progressing quickly” towards its £1bn fundraising target.
GIB was set up at the end of 2012 to back green energy projects and to spur private sector investment. The bank says that since then it has invested £2bn in 50 projects worth over £8bn, including waste management plants and offshore wind farms.
Business secretary Sajid Javid announced in June that the government would sell off a majority stake of the bank within the next five years, though no announcement has been made about the exact size of the sale.