BlackRock-Backed Renewable Energy Invests in U.K. Green Ventures

October 17, 2013 by  
Filed under Green Energy News

Renewable Energy Generation Ltd. (WIND), a
developer of low-carbon assets that’s backed by BlackRock Inc. (BLK),
may invest 300 million pounds ($478 million) in onshore wind,
solar and bio-energy projects over the next three to four years.

The company is waiting for planning consent on about 140
megawatts of onshore wind sites and it plans to file
applications for another 100 megawatts, Andrew Whalley, chief
executive officer of Guildford, Surrey-based REG, said today by
phone. It’s also building a solar plant and a bio-energy
facility that converts used cooking oil into electricity.

REG aims to exploit demand for renewables in Britain as the
country seeks to get 15 percent of its energy from clean sources
by 2020 from about 9.4 percent now. BlackRock in January bought
wind farms from REG and agreed on a five-year partnership that
allows it to buy more plants from the developer.

“We have a colossal amount of investment to do over the
next three years and it will be funded by recycling some of the
investment through our relationship with BlackRock, partly by
debt and partly by other means,” said David Crockford, finance
director.

Outside of its agreement with BlackRock the company has
seen “quite a big appetite” for operating wind projects that
may see prices go up, as there are more buyers than assets,
Whalley said. In addition, there has been a change in the type
of buyer as more pension funds and institutional investors enter
the market, he said.

REG expects to reach financial close on two wind farms
totaling 18 megawatts by year-end. The projects already have
planning approval and they should start working by the middle of
next year. The two plants will cost about 20 million pounds.

The company has been in talks with German and Dutch banks
as well as some Scandinavian banks for the debt. They typically
lend for 10 to 15 years and are “used to” infrastructure
finance, Crockford said. They’re looking to increase activity in
the U.K. renewables market as British banks struggle to offer
infrastructure-style debt, he said.

To contact the reporter on this story:
Louise Downing in London at
ldowning4@bloomberg.net

To contact the editor responsible for this story:
Reed Landberg at
landberg@bloomberg.net

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