Blog post
When we say biofuels, what do we actually mean?
30 October 2024
There are at least eight different types of biofuels made from different feedstocks and made in different ways. In this blog, we define the eight types and the issues associated with their production.
Blog post
Rates are coming down, but should the Energy Transition hope for a recession?
16 October 2024
The financial news is full of messages about the bloating and volatility of capital markets, led in-particular by the tech mega-caps. The condition of the underlying economy doesn’t justify this bloating and indeed it doesn’t take much to scare the markets off their current highs. These lofty stock prices appear to be everywhere unless ironically – like me – you tend to read everything through the energy transition (ET) lens. Let’s be honest, one can’t help a feeling of FOMO! Aren’t we supposed to be the great economic miracle of this century?
Consensus seems to be that overall monetary policy has done a reasonable job at taming the recent inflation bout. Thankfully so far this has been done without tipping the global economy into recession; no small feat given the myriad of additional headwinds. Fair to say though those same monetary policies have created a huge headwind in renewables, understandably so given cost of capital is the fuel of the transition. And that, in part at least, is the answer for our FOMO as we know.
Blog post
Is FER 2 the beginning of the offshore wind era in Italy?
17 September 2024
Italy, one of the most promising markets for floating offshore wind
We were recently asked by a client to indicate which countries we think could build commercial size floating offshore wind projects by 2030. They looked very surprised when we mentioned Italy in our very short list, together with the UK and Korea (and optimistically Taiwan).
In recent years, offshore wind has been a central topic of discussion in Italy, with the arrival of a long-awaited government decree and a large number of projects under development. The industry is now more vibrant than ever. Italy is currently considered the third most promising market for floating offshore wind development in the world.[1] What does this mean for a country that at the moment has only one operational fixed bottom offshore wind farm installed, for a total of 30 MW? What is actually required to unlock this potential?
Let’s start by digging into the numbers. Although the offshore wind target that the Italian government set in the latest NECP[2] was 2.1 GW by 2030, both market research and industry publications have adopted a much more bullish view. According to a number of industry studies[3], Italy has the potential to install 11 GW of offshore wind capacity by 2040 and to reach at least 20 GW of installed capacity by 2050. Achieving this growth has the potential to unlock a cumulative value of ~EUR 57 bn and to create approximately 27,000 new jobs between 2030 and 2050.
Blog post
Is the UK Offshore Wind Industry Spinning Back into Gear through the CfD results?
4 September 2024
Yesterday the UK government announced the results of Allocation Round 6 (AR6) of contract for difference (CfD). The UK’s CfD scheme has long been touted as the mechanism of choice for incentivising investment in renewable energy projects – with the capital intensity of offshore wind (OW), this support mechanism is especially critical.
Blog post
Mayfair or Old Kent Road – what is your biogas project actually worth ?
30 August 2024
There has been a spate of high profile deals in the biogas sector in recent years, culminating in Shell paying an eye watering GBP 1.6 billion for 14 operational plants in Denmark. This record transaction no doubt has many biogas plant owners thoughtfully sucking a tooth and wondering what their plant may be worth. As we will see below, the answer is frustratingly “well it probably depends”.
Article
The significance of FlagshipONE’s cancellation
29 August 2024
Ørsted’s FlagshipONE e-methanol project was initially hailed as a groundbreaking development in the race to decarbonise hard-to-abate sectors, such as shipping and aviation. The project aimed to produce 55,000 tons of e-methanol annually, using renewable electricity and captured CO2. Outside of refinery projects, it seemed one of the few projects moving ahead despite continued delays in the rest of the market.
Blog post
Chinese turbines cannot succeed in the European offshore wind market because they are not bankable. Myth or reality?
15 August 2024
This month, Mingyang announced a deal with the Italian government to build a factory in Italy supplying their 19MW turbines to the wind farms developed by Italian developer Renexia. It is the latest of a series of announcements that involve the Chinese turbine manufacturer. They already supplied the first ever Chinese offshore turbines in Europe for a project developed by the same Renexia off Taranto and have now signed a preferred supply agreement with Luxcara, who has just won a 1.5 GW site in Germany this week.
While Chinese dominance in solar, battery and so many other sectors has been widely accepted, each piece of news about Chinese turbine suppliers knocking at the European door is followed by heated debates. Is the competition fair or is China subsidising its industry, as suggested in a recent investigation of the EU commission that raises fears of a new trade war? Should the European policy makers go one step further and copy the US in their protectionism? Can public auctions define rules that prevent Chinese turbines to be competitive? In the urgency that climate change commands, is the question of where the turbines come from of any relevance at all? While the cost of living is fuelling the surge of the extreme right everywhere in Europe, is it sensible to fight the cheapest option?
Blog post
Bacteria to the future
10 July 2024
Making more gas from waste and importing less fossil fuel derived gas will be key if Europe is to reach net zero whilst simultaneously maintaining energy security. But parenting trillions of little bacterium is a lot harder than it looks. In this blog we look at the 3 challenges of running an anaerobic digestion plant.
Blog post
Is the UK net zero energy policy by 2030 even possible?
28 June 2024
In the current vitriolic election in the UK, two words, net zero, come up often. However, the route to this specific Eden is lined with lots of questions. How would the UK be if we relied on the intermittent wind plus the sun for energy? How would we keep hot on those winter evenings when the wind is not blowing? How would our industries get enough energy to run 24 hours? Does the energy mix work if we omit 100% of fossil fueled energy from our thinking?
Blog post
No country for old men – is it becoming too hard to be an early mover in the UK battery energy storage market ?
Energy Blog
24 May 2024
The other day I was standing on the Tube and broke one of the cardinal rules of public transport by inadvertently making eye contact with a young woman. We exchanged very brief smiles then she stood up, touched me gently on my forearm and politely offered me her seat. This made me realize that I am now seen as an old man and should resign myself to this sort of thing happening more often. I was reflecting ruefully on this experience as I read a Bloomberg report that said the price of batteries for Battery Energy Storage Systems (BESS) has dropped by as much as 90% in the last 15 years and from USD 160 per KWhr in 2020 to less than USD 110 KWhr in 2025. And note this is full system prices not just cell packs.
Article
Transforming South Africa’s energy landscape through market liberalisation and renewable growth
14 May 2024
It is hard to believe that it’s been more than a decade since the world turned its eyes to South Africa as the host of the 2010 FIFA Men’s World Cup, a momentous event that showcased the nation’s vivacity and potential on the global stage. Around the same time, South Africa’s electricity sector stood at a crossroads, fighting with a number of challenges ranging from aging infrastructure to an insatiable demand for power.
Blog post
Finding the right combination – using renewables to unlock the base load problem
Energy security in South Africa
2 April 2024
A favourite Sunday afternoon activity for the Marshall family growing up was a family walk (usually accompanied by the Irish rain to be honest). From time to time, we would venture to some of the hills not far from my parents’ home where we could walk in and around these new and unusual wind parks. And from time to time there would be no turbines turning. How does that work and how is that efficient my father would ask?
Now that’s a while ago and today those same hills have many more turbines, but this question is still one I hear quite frequently and in no doubt has played a role in perpetuating the popular belief that renewable energy is not reliable. I don’t think too many people outside of the energy industry have spent a long time wondering how the electricity grid functions and what goes into it (if you are used to electricity arriving at the flick of a switch, why would you?), but nonetheless this perception persists. And there is some truth to it if we are honest. The wind does not always blow as expected and although the sun rises and falls regularly, cloud cover is not something we have the same level of certainty on when predicting solar generation patterns.
It’s not unexpected then that there continues to be a common mantra of ‘conventional generation for baseload’ even within the energy industry. But what happens when we test this thesis and examine the evidence?
When we at Green Giraffe Advisory began to look at the framework for the South African emergency Risk Mitigation Independent Power Procurement Programme (RMIPPPP) tender a few years ago, it was immediately clear that the process had been designed with conventional generation solutions in mind – although technology neutral, it was asking for dispatchable generation to provide baseload like generation between 5h00 and 21h30 for the lowest bid price possible. However, with our client G7 Renewable Energies for the Oya Energy project, we began to examine the possibility of responding to these needs with a solution fully based around renewable energy.
This wasn’t a unique idea (although the solution combining wind, solar PV, and storage at the same location is) and eventually what came out of this tender process was a list of projects reaching financial close that was dominated by renewable energy-based solutions.
What can we read into this?
Whilst not a silver bullet to the variability brought by renewable energy to a grid, it certainly shows the ability for a single plant with a combined interface of solar, wind and storage (the plant controller playing a vital role behind the meter for these components to then perform their collective role) to provide services to the grid operator at a price which is a competitive (or even more competitive) compared to conventional competitors.
That might not work so well in every geography (it certainly helps that South Africa has great wind and solar resource) and indeed it is likely in many places that it would be more economical to manage such interface and dispatch at the level of the grid. However, that in itself gives rise to the further question as to how a national grid heavy with renewable energy might function.
The duck curve is widely observed and analysed (i.e. the effect on the load throughout the day when there is a mass of solar PV generation in a system). My colleague Michael Ware has already commented here on what this may mean for idea of required baseload from conventional generation. It’s a stretch to argue that one project is a proof of concept, but we think Oya Energy provides a fantastic example of how renewable energy can help provide dispatchable and baseload type generation at a micro-level. Additionally, replicating a project such as Oya Energy in a geography where the overall grid is less developed or there is an energy intensive captive demand could still make a lot of sense.
We are immensely proud of what we achieved on Oya Energy, alongside G7 Renewable Energies and Engie. Not simply because of the addition that makes to cleaner energy security in South Africa but because of the precedent that sets for the use of renewable energy to provide stable power to the grid during a long window. And to be able to blow away (pun intended) some of those persistent old perceptions about renewables at the same time does no harm either.
Blog post
Navigating South Africa’s electricity challenges in the era of market liberalisation
Energy security in South Africa
25 March 2024
The electricity supply-demand equation in South Africa continues to be an unsolvable one as load-shedding continues to blight the country. South Africa benefited for many years from having a reliable and sustainable electricity supply. Although this supply was heavily polluting, the role that affordable electricity played as a catalyst for economic growth cannot be overlooked – something that was exceptionally important for South Africa during the 1990s.
Presentation
How to optimise income streams and untapped upside potential of EV charging
EV charging
8 March 2024
Barbara Zuiderwijk presented at the EV Charging Infrastructure Forum 2024. Interesting exchanges on user experience, evolving EV charging technologies and the challenges of a maturing industry.
Barbara shared insights about EV business cases, how to optimise income streams and untapped upside potential.
EV is destined to be the dominant technology for the vast majority of road vehicles in the near future
EV is primed for adoption and consolidation
Unlocking more (empirical) data will unlock access to cheaper capital
There is still untapped potential in most business cases – whether this is in energy trading, grid stabilization or alternative income streams next to EV charging
The market is stable/proven enough to make large investments. Key is to find the right investment!
Download the full presentation below by clicking on the download button in the yellow block and don’t hesitate to reach out if you’d like to learn more!
News
The liberalisation of the electricity market in South Africa
Energy security in South Africa
8 March 2024
Green Giraffe Advisory (“Green Giraffe”), organised a breakfast panel event on South Africa Energy. The title of the discussion was “Exploring the impact of the liberalisation of the electricity market on the financing of renewable energy projects in South Africa“. It took place on 7th March 2024 in Cape Town International Convention Center, South Africa.
This event was set up to highlight the successes and challenges facing the current market transition in the country, with a focus on some landmark deals, financing developments and market reforms that have shaped the recent trajectory of the energy sector.
Blog post
The price is right – how much is your renewable energy project really worth?
28 February 2024
As said by Warren Buffett, price is what you pay, value is what you get. You want the two to be roughly the same. The world’s renewable energy capacity grew at a record pace in 2023. For the first time ever, in 2022, investments in clean energy overtook investments in fossil fuels and they continue to outpace the latter. This has triggered an explosion of activity in buying and selling projects. More than ever, buyers and sellers are confronted by the question: at what price?
This blog aims to lay out the fundamentals of valuing renewable energy projects. For accessibility, we have tried to avoid using complex financial lingo or digging too far into the details. As financial advisors who work on many sell-side and buy-side energy transition transactions, one of our key tasks is valuing the projects, portfolios or platforms in question.
News
Green Giraffe Advisory strengthens its presence in France with the opening of an office in Marseille
Opening new office Marseille
26 February 2024
Green Giraffe Advisory (“Green Giraffe”), a leading financial advisor in the global renewable energy transition, has opened an office in the city of Marseille. This second French office aims at actively supporting the local French renewable energy community and enable the acceleration of the French energy transition.
Blog post
It looks, waddles and quacks – will we see Californian duck curves in Europe any time soon?
Energy Blog
14 February 2024
The US state of California leads the world in the transition to renewable generation but this has led to some unexpected negative consequences which may be a foretaste of problems in Europe
One of my friends is a twitcher and one is a trainspotter. To explain, a twitcher is somebody who collects sightings of birds. Sometimes stormy weathers blows unfortunate birds across the Atlantic and twitchers will travel huge distances to spot a miserable foreign bird looking a bit lost in a big wet field by the sea. A trainspotter is somebody who collects locomotive identification numbers and will also travel long distances to see an obscure locomotive in a remote railway siding though trains tend not to be blown in by storms. What’s more interesting is that despite their apparent similarities, my two friends can’t stand to be in the same room as each other. But the underlying history of their mutual antipathy is probably another blog all in itself.
The inevitable segue way into renewables is the possibility of California duck curves appearing in Europe. This won’t appeal to my twitcher friend as a Californian duck curve is not a real duck but a metaphorical term used to describe an unusual pattern in electricity demand/price markets. To those of us in the renewable energy industry it is equally exciting.
Blog post
From Cold War to Code War – the Cyberwar on Renewables
Cybersecurity of Renewables
2 February 2024
In our latest blog, Claudia MacKenzie dives into the risk of cyberattacks on renewable energy infrastructure, notable past incidents, and what preventative measures can be taken to help deal with this growing threat.
I don’t think a day goes by, at the moment, where my phone doesn’t get a news notification about another missile being sent, even more innocent lives lost, or new conflicts and tensions rising. Whilst I would like to offer this blog as a more uplifting and lighter read, I do think that it is worth shedding light on another, more silent, form of warfare that is ongoing and will increasingly impact the renewable energy industry.
I read a book last year called “This is How They Tell Me the World Ends” which, despite its cheerful title, I found very interesting. Nicole Perlroth, the author, takes a deep dive into the ongoing cyberweapons arms race, explaining the origins of this unregulated market, how countries buy and use such weapons, and why they represent a substantial threat to our near future.
News
Green Giraffe Advisory supports Mitsui, RWE and Osaka Gas in securing 684 MW project in Japanese offshore wind auction
Offshore wind
23 January 2024
Green Giraffe Advisory (“Green Giraffe”), a global energy transition financial advisor, has advised the consortium of Mitsui & Co., Ltd. (“Mitsui”), RWE Offshore Wind Japan Murakami-Tainai K.K. (“RWE”) and Osaka Gas Co., Ltd. (“Osaka Gas”) in their successful bid to deliver a commercial-scale offshore wind project off the coast of the cities of Murakami and Tainai, Niigata Prefecture, Japan.
The Japanese Government has appointed the consortium to develop, construct and operate a fixed-bottom offshore wind farm off the country’s west coast. This is in line with the country’s commitment to expanding offshore wind capacity as an integral part of its sustainable energy goal to become carbon neutral by 2050.
Blog post
Green Giraffe reflection and 2024 key themes
18 December 2023
2023 has been another fascinating year for the energy transition and Green Giraffe has played its part! With COP28 behind us and 2024 about to start, we wanted to reflect on the key moments from this year and also to identify what critical trends we see coming up for 2024.
Top down, 2023 represents the halfway point between the 2015 COP Paris Agreement and 2030, by which point we should have halved our carbon emissions. We’ve deployed a lot more renewable energy, particularly in the last few years, but carbon emissions keep increasing. Encouragingly though, it looks like we will achieve peak oil and peak coal prior to 2030, with peak gas – the transition fossil fuel – coming in the mid-2030s. The momentum is clearly behind wind and solar as the key decarbonisation technologies and although some colleagues disagree, it’s hard to see that changing materially in the short to medium term, irrespective of policy head- or tail- winds (including a potential Trump re-election).
Blog post
What’s in store for Dutch batteries?
storage
11 December 2023
Despite rapidly picking up the pace on the roll-out of renewable energy, with a staggering 8-fold increase in installed capacity between 2013 and 2022, the Netherlands are lagging far behind on their neighbours and on self-imposed targets when it comes to the much-needed electricity storage. Policy has not been supportive so far, but various announced and ongoing changes may finally move the needle. It is about time that we take a closer look at what’s in store for Dutch batteries, and whether it’s enough to bring the targets back in sight!
Blog post
Offshore wind: Glimmers of hope (and not from where you’d expect)
Offshore wind
17 November 2023
On the surface of things, 2023 has not been the best year for offshore wind. For a sector used to good news, this year has brought a flood of the opposite:
Vattenfall walked away from its 1.4 GW Norfolk Boreas project stating that market conditions had rendered it uneconomical (we wrote a blog post about this)
The UK, long the leading market for offshore wind globally, launched an auction that attracted zero bids from offshore wind developers
Poor financial results have required Siemens Gamesa, a leading turbine supplier, to apply for government support – it will be receiving EUR 7.5 billion in government guarantees
And most recently, Ørsted took a USD 4 billion impairment charge and ceased development on two of its projects off the coast of New Jersey – Ocean Winds 1 and 2. Its share price dropped 26% following the news.
This doesn’t exactly paint a picture of a thriving sector; but this picture is also incomplete.
If we take a closer look, a more nuanced and positive story emerges – one that, if managed properly, will help lay the foundations for a more sustainable and resilient industry that can deliver on its ambitions. For that, we need to turn to the supply chain.
Blog post
Is it a positive future for EV charging ?
Energy Blog
27 October 2023
This is a blog about EV chargers in the UK. It’s also about the difficulty of sizing markets, the curious phenomena of kinked demand curves for semi-skimmed milk and how many EV chargers I think will actually be installed by 2035 (spoiler alert, it’s a lot less than you may think).
Presentation
Hydrogen deployment – From plans to practice
Hydrogen
16 October 2023
Green Giraffe Advisory – H2 Breakfast Networking Event, 12 October 2023
Green hydrogen and e-fuels are key markets for the energy transition, and over the last few years the Green Giraffe team has developed a strong track record of raising finance for green hydrogen and green ammonia projects around the world.
The announcements of Green hydrogen projects are plentiful – but what does it take to go from plans to practice?
Barbara Zuiderwijk shared Green Giraffe’s insight at the third H2 Breakfast Networking event co-organised with Loyens & Loeff in Rotterdam.
The presentation delves into the necessity for market players to take the first step together and what developers of big PtX projects can learn from how offshore wind went giga-scale – and got it financed.
Download the presentation at the bottom of this page.
News
Green Giraffe Advisory opens office in Japan
Press release
2 October 2023
Green Giraffe Advisory (“Green Giraffe”), a leading financial advisor in the global renewable energy transition, has opened an office in Tokyo to help accelerate the green energy transformation in Japan, the Asia Pacific region and globally.
The Green Giraffe team in Tokyo is led by Jun Kasamatsu, who brings over 20 years’ experience and track record in renewable energy and investment banking.
The new Tokyo office will work closely with all existing Green Giraffe teams around the world to support domestic, inbound and outbound investment. The Tokyo team will work closely with our partner Daiwa Securities Group Inc. (TSE:8601) including its global corporate finance platform, DC Advisory, across the broad Asia-Pacific region.
The full scope of Green Giraffe services, including M&A, debt advisory, capital raising, development and tender support, financial modelling, PPA structuring and strategic support, will be offered across all renewable and energy transition technologies, including solar, onshore wind, offshore wind, energy storage, grid solutions, bioenergy, and hydrogen.
Jun Kasamatsu, Head of Japan, Green Giraffe says: “We are very pleased to have established our local subsidiary and to have opened the Tokyo office. This enables us to provide our full range of services in Japan supported by an expert local team that is backed by our global talent pool of industry professionals. Our goal is to bring and leverage our industry pioneering green energy knowledge and experiences to help Japan achieve its’ ambitious decarbonization goals in both the near term and long term. ”
Matthew Taylor, Director of Green Giraffe Asia Pacific says: “Green Giraffe has historically been very close to Japan through its strategic partnership with Daiwa Securities Group and the many Japanese corporations that we have served. Japan is a core market for Green Giraffe and we are committed to providing our full range of services to support Japan’s green energy transition.”
With the opening of its Tokyo office, Green Giraffe’s presence now spans across ten locations; Boston (US), Cape Town (South Africa), Hamburg (Germany), London (UK), Madrid (Spain), Paris (France), Singapore, Sydney (Australia), and Utrecht (The Netherlands). Since its inception in 2010, Green Giraffe has worked on over 294 key energy transition projects in over 67 countries.
Green Giraffe Japan office is located at Toranomon Hills Business Tower 15F, 1-17-1 Toranomon, Minato-ku, Tokyo 105-6415, Japan.
About Green Giraffe
Launched in 2010 and with offices in Boston, Cape Town, Hamburg, London, Madrid, Paris, Singapore, Sydney, Tokyo, and Utrecht, Green Giraffe offers bespoke financial advice, market intelligence and development services in all renewable and energy transition technologies.
In October 2019, Green Giraffe established a strategic partnership with Daiwa Securities Group. Green Giraffe partners with Daiwa’s global corporate finance platform DC Advisory, and its market-leading Infrastructure franchise, to bring full service expertise for all clients.
For more information, please contact:
Kees van Oort
Email: k.vanoort@greengiraffegroup.com
Phone: +31 627158614
www.green-giraffe.com
Blog post
“You used to be cool”
Energy Blog
29 September 2023
On 22 September 2023 the Baltic Power offshore windfarm successfully reached Financial Close, thereby unlocking the staggering amount of EUR 3.6 bn term loan and EUR 0.8 bn of ancillary facilities for one of the largest offshore windfarms yet to be constructed and the first of many to follow in Poland. As we have reported elsewhere, this is a big deal. Baltic Power will deliver renewable energy to the equivalent of 1.5 million Polish households, in one of the most carbon intensive energy systems in Europe. A great leap forward in the fight against climate change, one would say.
However, within a week, the UK government approved the development of the Rosebank oil and gas field. The announcement was followed closely thereafter by the final investment decisions (FID) of the developer of Rosebank, earmarking a similar EUR 3.6 bn amount in USD equivalent to fund the progress of Phase 1 of their project. An estimated 300 million barrels of oil can be extracted from Phase 1. Assuming EPA’s conversion methodology, this implies a CO2 equivalent of 129 million metric tons. To put this in perspective that is about equal to the combined annual CO2 emissions of the 28 lowest-income countries in the world according to opponents of the project.
Blog post
10 tips for presenting your renewable energy investment case
Energy Blog
26 September 2023
Your business case is the little word seed that could either grow into a real energy project or wither and die. Here are our 10 tips to ensure it actually germinates
My unlikely inspiration for writing this blog was watching 8 Mile Road, Eminem’s bleak but ultimately uplifting film about growing up as a rapper in Detroit. Now I know that fat, bald, white, middle class and middle aged men being inspired by rap is a comedy character all by itself but the phrase “you get one shot, don’t let it blow, this opportunity comes along once in a lifetime” made me think about how many clients only get a very limited window to pitch their idea to investors and how quite a few often don’t make the most of it. Business cases are the tiny seeds that grow into real projects. Your average investor sees a lot of potential ones every month and inevitably turns most of them down. This is a blog about how 10 common tips can make sure your proposal actually gets read and germinated.
News
Green Giraffe and Pekao Investment Banking advise on EUR 4.4 bn non-recourse financing of the Baltic Power offshore wind project
Press release
19 September 2023
Global energy transition financial advisor Green Giraffe Advisory has advised the sponsors, Northland Power and ORLEN, on the EUR 4.4 bn non-recourse project financing consisting of EUR 3.6 bn of term loan facilities and EUR 0.8 bn of ancillary facilities for the 1.14 GW Baltic Power offshore wind project.
The debt financing for Baltic Power, which was signed on Wednesday, 19 September, is being provided by 25 banks including the European Investment Bank (EIB), European Bank for Reconstruction and Development (EBRD) and the export credit agencies EDC (Export Development Canada), EIFO (Export and Investment Fund of Denmark) and Germany’s Euler Hermes as well international and local commercial banks.
The Baltic Power project is located in the Baltic Sea approximately 22 kilometers off the Polish coast and has obtained all environmental approvals and major construction permits. Once operational, which is estimated in the latter half of 2026, Baltic Power will be amongst the largest offshore wind projects globally. It is expected to provide clean energy to over 1.5 million Polish households and will play an important role in helping Poland achieve its target of up to 11 GW of offshore wind to be constructed by 2040.
Blog post
Big Oil and the energy transition: it’s not them, it’s you
8 September 2023
When it comes to business, scale can be an inhibitor, but more often than not size tends to win out. Over time, it’s the largest that endure. “Big” is a simple moniker we use to acknowledge this in ode to the leading firms in a sector: Big Four (accounting), Big Pharma, Big Ag (farming), Big Car, Big Tobacco and the most dominant of all in the 21st century; Big Tech.
Perhaps the most influential though is Big Oil, a group of energy supermajors that dominate the non-electricity, non-coal energy world and continue to strongly influence global affairs. Supermajors, both state and public, extract and sell the majority of the oil and gas consumed around the world. In carrying out this business they also fulfil another critical function; providing attractive returns to their shareholders which comprise governments, institutions and individuals the world over. It’s a reasonable guess to say that your corporate pension is probably partly invested in an oil or gas company. Because of this ubiquity, their financial performance has a very meaningful impact on the prosperity of nations and individuals alike.
Blog post
Forever playing catch up on carbon capture
Energy Blog
2 August 2023
Industrial Carbon capture and storage is a good idea in theory and the UK has the highest potential storage capacity in Europe but exactly how we will pay industry to do it and what will it cost the taxpayer per ton of Co2 captured ? Despite this week’s announcement by the PM and preceding 3 years of Government consultation papers, we still don’t really know the answer to either.
Article
EU Roll-out of Green Hydrogen: Ready for Take-off?
2 August 2023
Unlocking the Path to Green Hydrogen in Europe: Assessing Challenges to Deployment, EU Political Intervention, and the Access to Finance
In this article, I will delve into the status quo and path ahead for a European green hydrogen economy. It will focus on the challenges to deployment, the outlook for project finance and the EU’s political response to the American Inflation Reduction Act (IRA), which was analyzed in Josh and Agathe’s recent blog post. Read on to explore this fascinating crossroads of energy policy, technology, and finance, and feel free to engage in the comments section of the original LinkedIn post.
Blog post
Reaching for the stars – decarbonising the UK energy system
Energy Blog
1 August 2023
Achieving net zero generation for the UK by the end of 2050 requires a lot of new renewable capacity to be added to the grid every year for 28 years. Is this achievable and if not, why bother trying ?
A reasonable rule in life is to break down a seemingly insurmountable challenge into lots of little achievable cumulative tasks. If you want to lose weight start by occasionally walking to the station rather than driving, then give up the biscuits then the beer and so on. Out of interest, I’m still at the occasional walking to the station stage. The same logic applies to decarbonising the UK energy system and the only way to do this is to keep building wind farms, solar farms and biogas plants and stop burning fossil fuels. It sounds easy and we have made a lot of progress in the last 10 years but I worry that like losing middle aged weight, the challenge may be much harder and take much longer than we realise.
Blog post
Dear Vattenfall: Congratulations
26 July 2023
Dear Mrs Borg,
I am writing to congratulate you on your recent decision to stop the development of the Norfolk Boreas projects. I would also like to thank Vattenfall and you specifically as CEO for your global leadership.
I could write this letter to many of your counterparts of course, including Mr Nipper (CEO Orsted), as alongside yourself there are thankfully many players active in our critical sector that are showing strong financial discipline. And that is the crux of my message: in the face of huge social and shareholder pressure to deliver new clean power I applaud Vattenfall for having stayed true to its primary responsibility; creating long term value for your shareholders and honouring your company’s strong social responsibilities.
Article
The Inflation Reduction Act at a glance
US Inflation Reduction Act
12 July 2023
The IRA – how this three-letter act is significantly advancing decarbonization and disrupting global hydrogen market competitiveness
The Inflation Reduction act marks the most significant legislation in slowing climate change in US history. With hundreds of billions of dollars committed to the clean energy economy through tax credits, grants, and loan guarantees, the US market for renewable energy is set to explode. In this article, we discuss the significance of this bill and how this funding dramatically alters the domestic and global landscapes for the renewable energy and hydrogen.
Blog post
Leading the charge – lessons from the UK’s experience of installing battery storage
Storage in the UK
6 July 2023
Pretty much every day the UK is installing more battery capacity than any country in the world apart from China and more fundamentally has developed more markets than anybody else for those batteries to operate in. At the time of writing, a battery connected to the UK grid can trade in 12 different markets which vary both in value and duration and unbelievably new markets are being developed as I write.
So what lessons can the rest of the world learn from us and probably more interestingly, what did the UK get wrong.
Article
The future of financing renewables in South Africa
24 May 2023
Since opening its office in Cape Town in 2017, Green Giraffe has been involved in three renewables government tenders in South Africa, with the most recent milestone being the financial close of the REIPPP Bid Window Round 5 projects of Coleskop WEF, Phezukomoya WEF and San Kraal WEF – the first three projects from Bid Window 5 to reach financial close. The South Africa market is now looking beyond government tenders towards utility-scale projects in the C&I space. What the REIPPP program has provided is a blueprint for financing utility-scale projects in South Africa for various offtake structures, and lenders & investors are allocating large amounts of capital to fund them – bringing much needed energy online.
Blog post
Joining up the dots
Energy Blog
10 February 2023
What wind, nuclear and the cost of French electricity tell us about the wider economy for 2023?
Daniel Marshall reflects on how looking at the data of the French electricity mix between December 2022 and January 2023 tells us a lot about the impact of renewables and nuclear power, and how interconnected this is to the wider economy.
Blog post
Flushing money down the drain
11 January 2023
Can the sewage network play a role in reducing greenhouse gas emissions?
Presentation
Green Hydrogen and Ammonia: value chain and regulatory context insights
BENELUX INFRASTRUCTURE FORUM
30 November 2022
Green hydrogen and e-fuels are key markets for the energy transition, and over the last few years the Green Giraffe team has developed a growing track record of raising finance for green hydrogen and green ammonia projects around the world.
Earlier this month, Barbara Zuiderwijk shared Green Giraffe’s insights regarding the hydrogen and green ammonia value chain at the 20th Benelux Infrastructure Forum in Amsterdam. The presentation breaks down the value chain for both green hydrogen and green ammonia, and explores the regulatory context.
The presentation is available for download.
Blog post
Are merchant storage markets overrated in the UK?
23 November 2022
A brief blog about the decline in spinning inertia, merchant revenue risks and the cost of capital in UK battery storage
News
Green Giraffe advises the shareholders of Flotation Energy on the Company’s 100% sale to TEPCO Renewable Power
10 November 2022
Green Giraffe is delighted to announce that it acted as exclusive financial adviser to the shareholders of Flotation Energy (the Company) on the disposal of their shares in the Company
On 1 November 2022, TEPCO Renewable Power, Inc. (TEPCO RP), the renewables arm of Tokyo Electric Power Company Holdings, Inc. (TEPCO Holdings), Japan’s largest electricity company, entered into an exclusive agreement to acquire 100% of Flotation Energy.
Flotation Energy is a world leading offshore wind developer established by current Chief Executive, Lord Nicol Stephen and Chief Technical Officer, Allan MacAskill in 2018, on the back of the successful development of Kincardine, the world’s largest floating offshore wind farm to date.
The transaction is a major milestone both for Flotation Energy and TEPCO RP. The acquisition is TEPCO’s first major venture into offshore wind markets in the UK and overseas and follows an initial investment in the TetraSpar floating foundation demonstration project in Norway and Denmark in February 2021. TEPCO RP is a long-standing operator of renewable energy plants and by far the largest in Japan, where it operates over 9 GW of hydropower capacity. Flotation Energy will benefit from TEPCO RP’s experience and resources to deliver more than 12 GW of commercial scale fixed and floating offshore wind farms in the UK, Ireland, Australia, Taiwan and Japan, with plans to expand in many more key markets.
Green Giraffe delivered its full suite of sell-side M&A services to the shareholders of Flotation Energy, including providing strategic and financial structuring advice, preparing the marketing materials, conducting a detailed valuation exercise, sounding a comprehensive list of relevant investors, and negotiating the transaction documents. Green Giraffe’s in-depth knowledge of the offshore wind sector and unparalleled track record in floating offshore wind was supplemented by DC Advisory’s intimate access to Japanese investors and expertise in cross-border transactions.
Lord Nicol Stephen, CEO & Co-founder of Flotation Energy, said: “The Green Giraffe team were outstanding from the start to finish of this transaction. Flotation Energy could not have hoped for advisers with a better understanding of our business and the fast-growing global market in floating offshore wind. Their expertise was critical to the success of the deal.”
Flotation Energy is based in Edinburgh, Scotland, and has been a significant contributor to building a strong offshore wind industry in the UK and beyond. Flotation Energy has a growing project pipeline of offshore wind projects with more than 12 GW in the UK, Ireland, Taiwan, Japan and Australia, and plans to expand into many more key markets. The expertise of the Flotation Energy team lies in the project and engineering management of large infrastructure projects. Flotation Energy have developed their own projects but also recognise the benefits of collaboration and working in partnership with other developers to deliver proven, cost-effective solutions.
TEPCO Renewable Power (TEPCO RP) is a wholly owned subsidiary of Tokyo Electric Power Company Holdings, Inc. (“TEPCO Holdings “), the largest power company in Japan. In April 2020, TEPCO RP assumed TEPCO Holdings’ renewable energy generation business and became an independent company dedicated solely to renewable energy. For many years, TEPCO RP has used a firm business model that covers everything from the planning and construction to the operation & maintenance of hydroelectric and wind power generation facilities. The total capacity of the company’s hydroelectric, wind, and solar power facilities is approximately 9.9 GW. TEPCO RP also owns 30% of the TetraSpar floating foundation demonstration project in Norway and Denmark.
Green Giraffe is a specialist advisory firm focused on the energy transition. Launched in 2010 and with offices in Boston, Cape Town, Hamburg, London, Madrid, Paris, Singapore, Sydney and Utrecht, we offer bespoke financial advice, market intelligence and development services in all renewable and energy transition technologies. In October 2019, Green Giraffe entered a joint venture agreement with Daiwa Securities, whereby Daiwa took a 50% stake in the company. Green Giraffe retains its well-known brand in the energy transition market with DC Advisory (Daiwa’s M&A practice) and Green Giraffe working together to bring their complementary strengths and skills for all clients.
Presentation
Green Hydrogen Breakfast event hosted in Hamburg
19 October 2022
Do you want to know what was discussed during last month’s Green Hydrogen Breakfast in Hamburg?
Blog post
The right goal, the wrong measures – Discussing the proposed interventions on the EU electricity market
Energy Blog
3 October 2022
With the ongoing energy crisis in Europe millions of households and businesses are struggling to pay their bill. At the same time, actors in the energy sector are generating large profits. What are the exact proposed interventions by the European Commission? Are the critics justified?
Blog post
Australia – time to play catch up on climate change
Energy Blog
26 September 2022
Marcus Dixson discusses what can be done to take Australia from climate laggard to climate leader
News
Green Giraffe opens Sydney office
Press release
25 August 2022
Sydney, 25 August 2022 – Green Giraffe opens office in Australia to support energy transition
Blog post
Digging into the numbers – will the price and supply of raw materials hinder the renewable energy revolution?
Energy Blog
20 July 2022
Claudia MacKenzie highlights the impact of the ongoing price and supply chain challenges related to raw materials for renewable energy
Blog post
Offshore wind and the emerging markets
Energy Blog
12 May 2022
Matthew Taylor highlights the key drivers for offshore wind in newer markets and some of the challenges facing the globalisation of the sector.
Blog post
The big circular economy myth – it’s not round, it’s a straight line
Energy Blog
3 May 2022
When it comes to recycling and moving towards a circular economy, humankind has a long road ahead. Michael Ware explores the big gaps and discusses critical steps that could bring us closer to our goal.
Blog post
Offshore wind, an inflexion point
Energy Blog
23 March 2022
Matthew Taylor reflects on key market movements in offshore wind.
Blog post
New York Bight lease auction – a bittersweet outcome
Energy Blog
28 February 2022
Wow! USD 4.37 billion bid for the New York Bight. Who saw that coming? Ever since the last BOEM offshore wind lease auction in 2018 those of us watching this space have traded opinions on the bids we would see in the Bight. It became the standard exchange over beers at every offshore wind conference since. “Will we see USD 300 million bid?”, “USD 500 million would be crazy, but we might see it”. Well, the high bid turned out to be USD 1.1 billion! We saw five bidders each commit more than USD 500 million for lease blocks. So what do we make of all this?
Firstly, this is hugely positive news for the US offshore wind industry. We may once and for all stop talking about whether the industry is really going to take off. Oh, it’s off alright. The winning bidders include the who’s who of pedigreed offshore wind sponsors – including EDF, Shell, CIP, EDPR, Engie, RWE and Total. These are veterans of offshore wind who clearly see the US market as a sound investment. We also saw several newcomers bring sizeable checkbooks and mount competitive bids. This is good to see. Hopefully we will see the same depth and diversity of bidders in the upcoming auctions for North Carolina and California later this year.
As we watched the live bidding unfold over three days, we couldn’t help but wonder as the bidding moved into the afternoon of the second day and bids roared past USD 500 million, if this wasn’t just crazy. Had these guys all lost their minds? By the end of the second day we still had twelve active bidders with the top lease block bid sitting at USD 900 million. No, it actually was not crazy. These were rational, sophisticated companies acting according to plan. Many of them had been strategizing, refining competitor analyses and running mock “Bight auctions” for months. The winners had carefully prepared. They were also well aware of the last auction results – not the 2018 Massachusetts auction, the 2021 UK Round 4 auction. The winning bids on a price per MW basis are generally higher than the winning bids for UK Round 4, but not wildly so. The market dynamics in the US logically drove higher bids. This brings us to the downside of these auction results.
At the end of the day, the US federal treasury picked up USD 4.37 billion. Where does that come from? The very rational and sophisticated bidders of course. And why would a rational and sophisticated bidder agree to make those payments? Because they reasonably expect to make it all back selling the electricity from those wind farms. So, ultimately it will be the rate payers whose utilities buy that power who will pay the USD 4.37 billion (plus a reasonable return of course). Hmm.
The New York Bight auction was a tremendous success and validation of the US offshore wind industry. Does the federal government need to make billions of dollars from these leases? No. Should rate payers pay billions of dollars more in their electricity bills to help sponsors recover the cost of these leases? No. Are billion dollar leases ultimately a good thing to support further growth of the US offshore wind industry? No.
There are several approaches to protect rate payers while allowing bidders to continue behaving rationally. Massachusetts offers one example. In each future offtake RfP, the state requires bidders to bid less than the price paid in the prior RfP. This simple approach captures – for the benefit of the state’s ratepayers – what should be the natural cost decline as the offshore wind industry matures. The result will be to force future lease auction bidders to factor this dynamic into their bid models rather than assume the offtake market will bear whatever is needed to recover their lease bid cost.
Onward to North Carolina!
Blog post
Our toxic legacy to the future, the shameful secret of the nuclear industry
Energy Blog
25 February 2022
One of the unexpected features of Zoom calls during lockdown has been the emergence of competitive book casing; people arranging the titles in their backgrounds to make them look more intelligent than they actually are. To make myself appear suave and urbane, I have replaced my tatty collection of Bill Bryson books with an old Roman lamp which I bought on eBay for GBP 30. This now proudly takes centre place in the background to my calls. Although it is only an unassuming bit of red pottery, it physically connects me to a civilization that died out over 2,000 years ago. This has had me wondering what our generation will leave behind for our distant descendants and depressingly, I think the main thing that survives us will be the nuclear waste from power stations and submarines.
On paper, nuclear power is a great idea. The astonishing potential of the simple equation E = mc2 means that we can create almost limitless power out of uranium twenty-four hours a day without any emissions. There are currently 440 nuclear power stations operating in the world and 150 decommissioned ones (although a couple of these, Three Mile Island and Chernobyl were decommissioned rather more rapidly and earlier than planned). These reactors collectively have a capacity of 400 Giga watts of electricity and in 2020, they contributed 10% of global consumption saving millions of tonnes of CO2 emissions.
So far so good but the big snorty elephant in the corner of the room of course is the fact that these 440 nuclear reactors and the 150 redundant ones are all producing High Level Nuclear Waste (HLNW). The distinction between high and low level waste is how radioactive it is or to put it another way, how likely is it to kill you. I’m not a nuclear scientist but my man in the street understanding is that about 1% of the fuel used in a power station is transformed into HLNW and according to the United States Nuclear Regulatory Commission, this will remain dangerously radioactive for about 24,000 years. The World Nuclear Association (WNA) grudgingly acknowledges this and buried deep in their otherwise breezily upbeat description of their industry is the telling line “that the disposal volume of the current solid HLNW inventory is approximately 29,000m3. For context, this is a volume roughly equivalent to a three metre tall building covering an area the size of a soccer pitch”. What they omit to say that if released into the atmosphere even a tiny particle of this 29,000 m3 of waste will keep killing a lot of people for a long time.
Despite attempts by WNA to minimize the scale of the problem, it is a rarely discussed but unalterable fact of the industry that here isn’t a real answer to HLNW. The only solution on the table is to bury it deep underground in what are referred euphemistically to as permanent geological repository (PGRs) and wait for a very long time for it to decay to the point where it won’t kill people anymore. However, understandably the people who live near potential sites do not fancy the prospect of having HLNW buried anywhere near them so getting planning permission for an PGR is pretty much impossible. To date there are no operating PGRs anywhere in the world, not one, zilch; although the Onkalo site in Finland has been in development for the last twenty years. The HLNW that should be being buried is sitting patiently waiting in ponds on the sites of nuclear power stations or at specialist reprocessing centers such as Sellafield.
For those of you not familiar with this site, Sellafield, on the west coast of the UK, is the largest nuclear processing facility in the world employing over 10,000 people working in more than 1,000 buildings. Basically it’s a huge nuclear complex like something that normally only features in James Bond films. As well as reprocessing nuclear waste from both the UK and abroad, it also stores HLNW in big ponds and unfortunately these occasionally leak. Since 1950 there have been twenty-one recorded incidents and Greenpeace now claims that the Irish sea is the most radioactive sea in the world although others claim the Dead Sea is even worse. Neither the UK nor Israeli tourist boards think to mention this in their brochures.
As well as storing HLNW at Sellafield, the UK also has a problem with its fleet of redundant nuclear submarines. The UK has not ever successfully disposed of any decommissioned nuclear submarine and there are now 20 quietly rusting away at various ports around the coast. So far the Government has spent GBP 500m guarding what are essentially large rusty metal tubes and the National Audit Office estimates we will send another GBP 7.6 billion guarding them until as they optimistically say “a practical solution can be found” which is probably never. The reason they need to be guarded is of course the fact that they contain small amounts of highly enriched uranium, which is both deadly but also a key ingredient for making crude nuclear bombs.
And finally there is of course the 1986 Chernobyl accident, by far the worst nuclear disaster of our lifetime. The facts about Chernobyl are so astonishing as to be almost incomprehensible but here are a few; over 30% or two million acres of agricultural land in Russia, Ukraine and Belarus was contaminated by the disaster and taken out of production, seven million people are now being paid state benefits because of the impact of the disaster on their livelihoods and the total cost to Belarus alone is estimated at $235 billion. That seems like a big number but has been trumped by Fukushima which some industry commentators think could cost the Japanese tax payer somewhere north of GBP 500 billion to clean up over the next forty years.
The obvious common theme to Sellafield, submarines, Chernobyl and now Fukushima is that there is no long term solution for HLNW apart from burying it in non-existent holes. Despite knowing this, the nuclear industry ploughs blithely on and at the moment there are 54 nuclear plants under construction. Most of these are in India or China although the UK is cheerfully commissioning Hinckley Point. The guaranteed “strike price” being paid to the owners, EDF, will be GBP 92.50 per MWhr compared to a prevailing wholesale power price of about GBP 45 per MWhr. This difference will cost the British taxpayer an additional GBP 50 billion over thirty-five years and probably makes Hinkley Point the most expensive UK power station ever built.
The Government has also recently announced a further GBP 210 million to develop a fleet of small modular reactors (SMRs). SMRs are appealing to Government Ministers because they are more voter friendly than a big reactor, little shipping container sized units that can power a medium sized town and don’t have the unfortunate historical association of their big brothers at Chernobyl, Fukushima etc. They are of course still fundamentally nuclear reactors and will produce small amounts of high level nuclear waste adding to the global stockpile but none of this features in the cheery Government announcements.
This does of course beg the question of why the UK Government keeps backing the nuclear horse? I think the answer is short term pragmatism. Despite warm words at COP26, 100% decarbonisation of UK energy generation is a long term maybe thirty year plus project and there are no quick non-nuclear fixes unless we radically change consumer behavior so the demand for energy dramatically decreases. We have made great strides on the generation side of the equation with wind, solar and biogas but there is still a huge journey ahead of us and legitimate questions remain about intermittency, how to reduce our seasonal reliance on Russian gas and how to decarbonize domestic heat. It is a sobering thought that no current member of the Cabinet is likely to live long enough to see a completely carbon neutral nuclear free energy mix in the UK.
If they work as promised, modular nuclear reactors are a sort of get out of jail free card to all of this, a short term technological fix to a difficult problem of energy supply versus demand and because they are new and untested, harder to empirically argue against. Politicians live in a world of electoral cycles and understandably prefer homegrown solutions that may crystallize within years not decades.
So despite knowing that there is no solution to the problem of nuclear waste and the almost inconceivable damage caused to Eastern Europe by the Chernobyl disaster, we are, to our collective shame, still ploughing on with different forms of nuclear power rather than admitting that the alternative of 100% non-nuclear decarbonization of energy will take decades to achieve. The nuclear industry claims their plants are safer than ever but the plants still inevitably produce HLNW waste, there are no PRGs anywhere in the world and all of the high level nuclear waste ever produced in human history is still sitting in occasionally leaky storage ponds waiting for a technical solution that never comes.
My 2,000 year old Roman lamp is a physical legacy of a great but long lost civilization. It probably doesn’t make me look urbane on Zoom calls but sitting in the same room with it for two minutes won’t kill me. Our own physical legacy to our descendants of nuclear waste will last much longer and be infinitely more deadly and I think they are unlikely to look back to us with quite the same fondness.
Blog post
Not seeing the big emissions wood for the millions of baby trees
Energy Blog
20 January 2022
Not seeing the big emissions wood for the millions of baby trees
Blog post
The VIPs – Vietnam, Indonesia and the Philippines
Energy Blog
9 December 2021
The VIPs of Southeast Asia: Vietnam, Indonesia and the Philippines. What’s next for renewable power?
Blog post
It floats – but is it financeable?
Energy Blog
10 November 2021
Clément Weber, co-chair of the WFO’s Floating Offshore Wind committee, discusses Green Giraffe’s foray into the floating offshore wind sector more than eight years ago and its stunning development since.
News
Green Giraffe announces new management team
18 October 2021
Utrecht, 18 October – Green Giraffe announces new management team
Blog post
The end of the affair
Energy Blog
12 October 2021
The EU have banned the sale of petrol or diesel powered cars from 2035.
What does this mean for European consumers, the car industry, and renewable energy?
Blog post
Stepping off the gas
Energy Blog
28 September 2021
Ahead of the COP26, Michael Ware discusses the surge in gas prices and the overnight shortage of petrol in the UK.
News
Green Giraffe rebranding
Press release
2 August 2021
New colours, same giraffe!
We are very excited to introduce our new visual identity – with a new logo, a new website and new fluffy giraffes! We started this process last year to celebrate ten years of Green Giraffe. With offices around the world and over 120 professionals in our team, the company has come a long way over the past decade.
While our colours may have changed, we are still the same animal with the same values.
Blog post
Renewable heat: the next big challenge?
Energy Blog
29 July 2021
How can the 13.3 giga tonnes of CO2 that are produced annually by the domestic and industrial heating sector be avoided? While decarbonising heat may well prove to be more difficult than decarbonising electricity, there are a few promising technologies and policies that may be up to the challenge.
News
Green Giraffe opens Madrid office
Press release
30 June 2021
An exciting new chapter for Green Giraffe has started: we have opened our office in Madrid!
This new chapter is being led by Meriem Essadki formerly from our London office who is joined by Ramona Kammerer (from Hamburg) and Mathilde Sapède (from Paris) – additional growth of the team locally is already on its way.
The new Madrid office will work closely with all existing Green Giraffe teams as well as with our partners Daiwa Securities and DC Advisory and is looking to actively expand our presence in Southern Europe, with a particular focus on renewable energy and the energy transition in Spain and Portugal. We look forward to catching up with you soon on all of these topics.
Blog post
Swimming against the European tide: why French politicians are surprisingly hostile to renewable energy
Energy Blog
16 June 2021
Despite, or maybe because of, being at the forefront of the nuclear energy revolution, France is now struggling to adapt to the transition to a renewable future. Jérôme Guillet discusses why.
Blog post
What does the Shell carbon emissions ruling actually mean?
Energy Blog
28 May 2021
Earlier this week Shell was ordered by a Dutch court to reduce its net emissions by 45% by 2030.
Blog post
What is the capture price for nuclear?
Energy Blog
29 April 2021
“Capture prices” have become a hot topic for renewables lately. Projects are increasingly exposed to short term spot prices even if they benefit from long term price regimes like CfDs (contracts for difference) – the power is still sold in the wholesale market in any case, and subject to the discipline of balancing costs and marginal pricing. The increasing penetration of wind and solar in many markets means that the industry is forced to grapple with a growing number of periods where there is a lot of wind power or solar power at the same time, as all projects in a given area are subject to the same weather patterns. When there is a lot of wind, and correspondingly a lot of wind power generated, supply may become too plentiful, causing prices to go down. When there is no wind, prices will go up, but wind projects will not get the benefit of these as they are not producing. If the production profile is not in line with demand, the capture price received by the project can be lower than the average wholesale price for all generation. While quite location-specific, it is generally estimated that the capture price for wind is lower than the average price (and is expected to go down a bit further in coming years), whilst the capture price for solar is often higher than the average price (thanks to power demand generally being higher during the day), with trends for the future varying quite wildly depending on demand patterns and expected future penetration.
Blog post
Single point of failure – lessons from the Ever Given
Energy Blog
19 April 2021
The grounding of the giant container vessel Ever Given across the Suez Canal has rightfully generated a lot of headlines, triggered both by the spectacular pictures of the skyscraper-sized vessel stuck in the sand and by the impact on global supply chains. For a lot of “just in time” businesses, the interruption of a vital route used by more than 10% of global seafaring traffic has had a direct impact on their production lines (and indeed we have learnt that one of our clients had their solar panels on that very vessel). This comes at a time when we have seen that shortages in microchips, manufactured by a tiny number of huge producers like TSMC, are causing havoc across critical industries like car manufacturing
Blog post
Green bonds: “I know it when I see it”
Energy Blog
31 March 2021
With ESG becoming an ever hotter topic as investors want to find sustainable and green assets, and the EU is working on setting definitions and standards (see Greenwashing in finance: Europe’s push to police ESG investing) to limit greenwashing, it is worth remembering one of the best known sentences in US Supreme Court history, when Justice Potter Stewart wrote that obscenity was hard to define, but “I know it when I see it”.
Blog post
In praise of (some) bankers
Energy Blog
12 March 2021
Moody’s have just published their 11th report on defaults and recovery rates for project finance bank loans, covering a large fraction of all transactions done between 1984 and 2016. The report shows that the sector continues to offer good risk discipline, with a “10-year cumulative default rate of 6.4% and an average recovery rate of 79.3%.” Moody’s further notes that “marginal default rates for project finance bank loans are similar to marginal default rates for high speculative-grade corporate issuers during the first three years following financial close. They fall over time, however, and trend toward rates consistent with the single-A rating category by year seven following financial close.”
Blog post
Texas: lessons learned from a Wild West electricity market
Energy Blog
26 February 2021
The unexpected winter storm caused millions to be without power in Texas.
Initial noise and commotion were around blaming renewables (as usual and expected). Going forward, will this be enough pressure for politicians to ensure functional infrastructure in Texas? Only they can tell.
Jérôme Guillet, Managing Director of Green Giraffe, discusses the lessons learned.
Blog post
Will a Biden presidency propel US offshore wind projects?
Energy Blog
25 January 2021
Will a Biden presidency propel US commercial scale offshore wind projects?
Sylvian Watts-Jones examines the last four years and looks at the road ahead.
Blog post
The lazy (and incorrect) use of the word “subsidy”
Energy Blog
8 December 2020
We would like to make a stand against the lazy – and incorrect – use of the word “subsidy”, by too many in the media and even in the industry, to describe contracts for differences (CfDs).
News
Asia-Pacific offshore wind map
La Tene Maps
16 November 2020
See the distribution of offshore wind projects in the Asia-Pacific region in La Tene’s last edition of the Asia-Pacific offshore wind map.
View the map here:
Contact us or La Tene Maps to get a print copy of the map.
Blog post
Is the Nordic region the new hotspot for renewables?
Energy Blog
12 November 2020
Despite its long winters and temperatures which can go as low as -50°C, is the Nordic region (Finland, Norway and Sweden) poised to become the new hotspot for renewables investors?
Blog post
Waste not, want not: the future of Energy from Waste
Energy Blog
27 October 2020
Michael Ware discusses Roman rubbish disposal habits and the future of the Energy from Waste industry.
A common complaint of the grumpy middle-aged European academic is the creeping Americanisation of language. An example often cited is ‘garbage’, although the pedants amongst us know that garbage was originally an English word that went to America with the pilgrims on the Mayflower and has only recently come back to its mother country via the medium of television. I was musing on this whilst watching an American program on the Discovery channel about Roman ‘garbage’ dumps and hence the inevitable segue into a blog about rubbish.
As well as the etymology of the word garbage, my other take away from the program is how modern civilization still disposes of its rubbish in much the same way as our Italian forefathers did: we put in big holes in the ground and pretend it never happened.
News
Green Giraffe opens Singapore office
Press release
14 October 2020
Another exciting chapter has begun for Green Giraffe with the opening of our new office in Singapore, led by Matthew Taylor.
The Singapore office will work together with our existing teams in Europe, Africa and America, along with those of our partner Daiwa, to support the financial advisory activities of Green Giraffe in the fast growing Asian renewable energy sector, and in particular look to continue our strong record in the core markets of Japan, Taiwan, Australia and South Korea. Matthew is initially joined by Marion Collette, with further growth of the team planned.
Blog post
Is the sun rising again on Spanish solar power?
Energy Blog
8 October 2020
On paper, Spain should be at the forefront of the renewable energy revolution particularly when it comes to solar power. It is a big largely empty country, has some of the highest levels of irradiation in Europe and relatively steep conventional power prices.
You’d think that these three factors would mean that solar power in Spain would be taking off like a budget airline heading to Magaluf, you’d think that Spain would be leading the charge towards a future powered solely by the sun and you’d think all those hot dusty plains would be transformed into acres upon acres of solar farms. You’d think all of these things, but you’d be wrong.
Although it is an over-used metaphor, the Spanish renewables industry has been on a bit of a hair-raising rollercoaster journey in the last 15 years. After a promising start when the country had one of the highest installed solar capacities in the world, the industry went down a very steep decline then a flat bit but is now seemingly going back up the scary steep section. The market is heating up dramatically and the international investor market is once again looking at the Spanish solar market with maybe too much enthusiasm? So, what has changed and why are we now back on the upslope of this peculiar rollercoaster shaped market?
News
Floating offshore wind map
Press release
8 October 2020
See the distribution of floating wind projects around the world in La Tene’s last edition of the floating offshore wind map.
View the map here:
Contact us or La Tene Maps to get a print copy of the map.
News
BlackRock invests in Belgian renewable energy developer Windvision
Press release
25 September 2020
Investment will support the build-out of Windvision’s renewable assets across Belgium, France and Spain. Green Giraffe acted as sole financial advisor to the shareholders of Windvision.
Location: Belgium, France, Spain
BlackRock recently invested in the European activities of Windvision, an independent renewable energy supplier. The company has been operational in eight countries across two continents. The investment was made by BlackRock as part of the deployment of its Global Renewable Power III fund (“GRP III,”), and will help support Windvision’s portfolio of development, construction and operational assets that will be built-out across Belgium, France and Spain.
GRP III is the third vintage of BlackRock’s global renewable power fund series. The Fund seeks to invest across the spectrum of climate infrastructure assets, with a focus on renewable power generation, and energy storage and distribution. In December 2019, BlackRock announced it had achieved a $1 billion record first close for GRPIII.
The investment by Blackrock’s GRP III fund is the first in Belgium, and offers the opportunity to accelerate Windvision’s growth to make it a leading platform in its target markets across continental Europe. The pipeline consists of about 1 GW of greenfield projects in different development stages, and a 19 MW operational project in Gesves-Ohey, Belgium.
Having successfully developed, financed, built and operated wind parks over several countries since 2002, Windvision has a deep knowledge of the complete value chain. It has since successfully realised over 200 MW of projects, obtained permits for over 800 MW, and grown into a 50-people team with deep expertise in the entire lifecycle of renewable energy projects. Windvision is well established in both Belgium and France, with local development teams and a strong development portfolio, all supported by the headquarters in Belgium. Windvision has aims to grow outside these two markets, and is currently developing a 300 MW project in Spain with a local partner.
Simon Neerinckx, CEO of Windvision, comments: “We are very enthusiastic about our partnership with BlackRock’s GRP III. The people of BlackRock are entrepreneurial and share our vision of realising a carbon-free economy. This company culture fits our own and will allow us to realise our ambitions, whilst staying true to our core values – integrity, accountability, commitment to excellence, and commitment to people- and our identity.”
Leon Vankan, former shareholder and CFO of Windvision, adds: “Combining the expertise of the Windvision team with the financial power of BlackRock’s GRP III Fund, I am certain that we will become a strong player in the renewable energy market in Europe. With these combined forces, we can remain involved in the full cycle of projects from greenfield stages until dismantling, which is positive for all stakeholders”
Green Giraffe and Allen & Overy advised the shareholders of Windvision in this transaction. BlackRock was advised by KPMG and Linklaters.
About Windvision
Windvision has been active in renewables for nearly 20 years and has developed activities in eight countries: the Netherlands, Belgium, France, Spain, Morocco, Serbia, Senegal, and Tunisia. It has since successfully realised over 200 MW of wind projects in Belgium and France, obtained over 800 MW of permits and grown into a 50+-people team with deep expertise in the entire lifecycle of renewable energy projects. The former shareholders of Windvision continue with the development activities, including the local teams, in wind and solar in Serbia and Africa, and biomass in other countries, under the name of “WSB Energy” and “CME”.
Further information on operational wind project in Gesves-Ohey
Initiated in 2003, the “Les Géantes du Samson” wind farm was gradually commissioned in autumn 2018.
This park is made up of six Siemens Gamesa wind turbines with a nominal power of 3.2 MW in the municipalities of Gesves (three wind turbines) and Ohey (three wind turbines).
The height of the mast of the wind turbines is 93 meters and the diameter of the rotor is 113 meters. The total height of the wind turbines when the blade is vertical is 150 meters.
With as reference an average electricity consumption per Belgian household of 3,500 kWh / year, the Gesves-Ohey wind farm produces the equivalent of the annual needs of 12,000 households. Thus 20,000 tonnes of CO2 will be avoided annually, which is equivalent to the discharge of around 10,000 cars.
Downloads
Presentation
Financing offshore wind transmission in the USA
24 September 2020
Randy Male discussed how lessons learned in Europe on financing transmission can help the growing US offshore wind industry.
The US offshore wind market is poised to finally take off.
Financing offshore wind transmission systems as the initial projects move to construction is a major decision – and cost driver. Lessons learned in Europe may help developers and policy leaders in the US organize for the most cost efficient outcomes.
On 24 September Green Giraffe’s Randy Male, director of our Boston office, presented on this topic at the 4th Offshore Wind Transmission, US conference. His presentation is available online.
Blog post
A new age of renewable energy in Morocco
Energy Blog
9 September 2020
Why is the Moroccan renewable energy revolution of interest to Western investors and developers? As yields on renewable energy projects fall to ever lower lows, investors are increasingly searching elsewhere for long-term, double-digit returns. Morocco may be the answer.
Presentation
Offshore wind – Auction designs and why PPAs are only second best
2 September 2020
With the emergency of zero-bids and falling electricity prices, how do European auction designs affect the economics of offshore wind projects? How do governments create a fair marketplace that ensures the best value for society? Udo Schneider discusses.
In the context of zero-bids and falling energy prices, Udo Schneider shared his insight at WFO’s Offshore Wind Economic Forum on the impact of European auction designs on the economics of offshore wind farms and considerations for governments to create a fair marketplace that ensures the best value for society.
News
Windpark Zeewolde announces refinancing
Press release
31 July 2020
Zeewolde saw the entry of Danish export credit agency EKF and Nederlandse Waterschapsbank into the transaction alongside initial financier Rabobank with the refinancing of Windpark Zeewolde which originally reached financial close on 25 June 2020.
The second major milestone in the financing of the largest onshore wind farm Windpark Zeewolde in The Netherlands is a fact: the Nederlandse Waterschapsbank (NWB Bank) and the Danish export credit insurer EKF have joined the Rabobank as co-financiers of the wind farm.
The financing of Windpark Zeewolde was reached at the end of June by means of a loan of approximately 500 million euros from Rabobank. The NWB Bank and the Danish export credit insurer EKF have now joined the wind farm as co-financiers.
General director of Windpark Zeewolde Sjoerd Sieburgh Sjoerdsma: “We are pleased that solid parties such as the Nederlandse Waterschapsbank and EKF are joining the financing. It shows the confidence that parties have in this community-driven wind farm.”
“The financing of Windpark Zeewolde is a perfect example of the elaboration and implementation of our ‘sustainable water bank’ strategy: the wind farm benefits from our attractive funding rates and as such we make a substantial contribution to an affordable energy transition in the Netherlands. This transaction also shows how we give substance to our commitment to the National Climate Agreement” says Frenk van der Vliet, Chief Commercial Officer at NWB Bank.
“We are very pleased to play a part in the financing of Windpark Zeewolde as it marks an important milestone; not only for Vestas as a Danish exporter but for the community behind the windfarm as a whole. The project illustrates how local commitment and international collaboration can enable the green transition” says Kirstine Damkjær, CEO at EKF.
In the new structure, NWB Bank, EKF and Rabobank share the risks of the large loan. In addition to the large loan, there is also a smaller subordinated loan that remains fully in the hands of Rabobank.
Pieter Plantinga, Executive Director Project Finance of Rabobank: “Windpark Zeewolde is a crucial step in achieving the goals of the Dutch Climate Agreement. And does so in such a way that the local community can benefit financially. We are pleased that these two strong parties confirm this course and strengthen the Zeewolde Windpark coalition.”
Construction of the wind turbines is expected to start in the first quarter of 2021. The entire wind farm will be completed in 2022 and it will be the largest onshore wind farm in the Netherlands and the largest community wind farm in Europe. The wind farm will generate electricity for more than 250,000 local households.
Windpark Zeewolde BV was advised by Norton Rose (legal advisor), Incredible and GreenGiraffe (Financial Advisors). The lenders were advised among others by Clifford Chance (legal) and MottMcDonald (technical).
News
Windpark Zeewolde reaches financial close
Press release
25 June 2020
Windpark Zeewolde B.V., Vestas and Rabobank have closed contracts for turbines and financing for the Windpark Zeewolde project in the Netherlands. Green Giraffe advised Windpark Zeewolde on the transaction.
Windpark Zeewolde B.V., a unique collaboration of more than 200 local farmers, residents and entrepreneurs of the Netherlands, has placed an order for 83 Vestas wind energy turbines totaling 322 MW for the wind project Zeewolde. The project is in the outskirts of Zeewolde, close to the IJsselmeer, on an area that covers over 300 square kilometers.
The wind park currently consists of more than 200 turbines which will be replaced by new Vestas turbines that will generate almost three times more energy with less the half the number of turbines, demonstrating the large potential in replacing older turbines with new and more efficient variants. The financing of the windfarm will be arranged by Rabobank. Rabobank will provide both the junior debt and a senior debt (approx. EUR 500m) for the construction of the project. Rabobank was keen to support the financing of this project, due to its cooperative structure comprising of a large client base of the bank in addition to supporting the energy transition.
Vestas has developed a customised solution that comprises a mix of turbine variants from the 2 MW and 4 MW platforms and a 20-year Active Output Management (AOM 5000) contract, capable of maximising the annual energy production while meeting local restrictions.
“We are convinced that we have signed strong partners with Vestas and Rabobank with whom we can now realize the windfarm construction quickly and efficiently,” says Sjoerd Sieburgh Sjoerdsma, Managing Director Windpark Zeewolde BV. “In October 2019 we already started with the construction of the substation and the wind farm infrastructure. This was based on the financing from our community showing the confidence and entrepreneurial spirit of our community. Now, with Vestas and Rabobank we can start the construction of the turbines”.
“I’m excited that our new customer Windpark Zeewolde B.V., chose Vestas as partner for such a unique wind energy project in my home country. It marks a great step for the renewable power supply of the region, and we are looking forward to, together with our partners, repower Europe’s largest community owned wind farm that is also Netherlands’ largest onshore wind project”, says Nils de Baar, President of Vestas Northern & Central Europe. “Leveraging customised wind energy solutions with lowest levelized cost of energy, this repowering project, for which more than 90% of the community living nearby has united as shareholders for, will almost triple the annual energy production.”
Rabobank was represented by Pieter Plantinga, Executive Director Project Finance during the process. He adds: “Watching tv, illuminating our houses, and nowadays working online from home: all available by the push of a button. Rabobank wants to ensure that when we press it, the consumed energy originates from renewable sources as much as possible. For that, we as a cooperative bank are willing to take financial risks if needed. Financing a wind farm of this magnitude requires months of effort from everyone involved. But it’s worth it, because this is a crucial step in achieving the goals of the Dutch Climate Agreement. Enabling the local community to profit from the revenues of park Zeewolde is a big plus and suits us as a cooperative bank.”
The deliveries of the wind turbines are expected to begin in the first quarter of 2021. The entire park will be completed in 2022, and it will be the largest onshore wind farm in the Netherlands and the largest community-owned windfarm in Europe.
Once repowered, the Zeewolde wind project will generate electricity for more than 250.000 local households.
News
Is Germany’s new offshore wind law fit for purpose?
Inspiratia
20 June 2020
Following the recent amendment of the German offshore wind law and a plethora of industry players expressing severe concerns, inspiratia looks back at the country’s offshore wind history and gives a first preview of what can be expected next. Will it be zero-subsidy bids or nothing?
Green Giraffe’s Simon Matthiessen was quoted in inspiratia’s analysis on the new offshore wind law.
The German offshore wind market has been one of the foundations of the global offshore wind industry, and the second largest in Europe – after the UK – with a current installed capacity of 7.68GW.
In the beginning of June [2020], the German Ministry of Economic Affairs upscaled its long-term target to reach 40GW by 2040 – an increase from 35GW by the same timeline – and also set an interim target to reach 20GW by 2030. With the already auctioned capacity expected to be commissioned between 2022 and 2025 standing at 3.1GW, the country will need approximately an additional 10GW to reach the interim targets.
To this end, the ministry also published the long-awaited offshore wind law amendment to update the rules for the next auction set for 2021.
The details sparked reactions from industry bodies and local states, both arguing that the auction design would jeopardise the long-term viability of the German offshore wind sector, and the cost-effectiveness of national electricity prices. Before we delve into the debate over the auction design, let us take stock of progress up to now.
Blog post
Are biofuels the next big opportunity?
Energy Blog
12 June 2020
As governments look to accelerate the decarbonisation of the transport industry, biofuels might be the next big opportunity in global renewables. Michael Ware discusses the RTFO obligation and the growing investment in organic fuels.
Blog post
Is the future of the blue sea red, brown or green?
Energy Blog
3 June 2020
In these extraordinary times, we have been thinking a lot about biomimicry, which, as you probably know, is an approach of taking innovations, patterns and solutions that already exist in nature and applying them to technology.
The core idea is that Mother Nature who has spent billions of years being creative by necessity, has already solved many of the problems humanity is facing so we can helpfully learn from her successes and avoid her mistakes.
A good example of this is the humble seaweed which is the collective noun for a range of species of multicellular algae. All seaweeds share a common ancestor with trees and mosses and belong to one of three groups commonly known as reds, browns and greens.
For such a small and unassuming plant, seaweed could play a big part in the battle against climate change.
News
Norther reaches technical completion and restructuring close
Press release
29 May 2020
The 370 MW Belgian offshore wind farm Norther has reached COD and simultaneously restructured its debt financing, with assistance from Green Giraffe.
On 27th May 2020 the Norther offshore wind farm officially transitioned to its operational phase as it reached technical completion. The 370 MW wind farm, comprising of 44 x 8.4 MW MHI Vestas V164 turbines is located in the North Sea, approximately 23 kilometres from the Port of Zeebrugge (Belgium).
The project commenced early operations in the spring of 2019 and has performed strongly since then. With construction works finalised in late March of this year the project was able to reach technical completion and to start commercial operations.
Despite the challenges posed by COVID-19 and the related restrictions, the project reached this important milestone, and due to good operational performance brought its debt package in line with the current status of the project and the market conditions. The debt package is provided by a consortium consisting of the European Investment Bank, the Danish export credit agency EKF and 9 commercial lenders – ABN AMRO, Belfius, BNP Paribas, Rabobank, Nippon Life, SMBC, SMTB, Société Générale and La Banque Postale, all existing lenders to the project.
Norther would like to thank the lenders for their continuous support, especially in the recent months, which demonstrates how important strong renewable energy projects will remain for relaunching the economy after the current difficult times. The original concession was granted at the end of 2009, which is when the development of the project began, and the project was awarded a tariff under the LCOE scheme in 2016.
As the largest operational wind farm in Belgium, Norther represents a significant addition to the country’s offshore wind installed capacity and contribution towards the Belgian 2020 renewable energy targets, demonstrating the commitment of the investors, lenders and the federal government towards sustainability.
News
Sunvest and TREF build two large solar parks in the Netherlands
Press release
15 May 2020
Sunvest and Triodos Renewables Europe Fund will jointly build two large solar parks in the municipality of Midden-Groningen, with a total capacity of 112 MWp. Sunvest was supported by Green Giraffe for the development and financing of the projects.
On 15 May, the financing has been completed for Energiepark Duurkenakker. The solar park located in the Tussenklappenpolder near Muntendam, is approximately 44 ha (88 football fields) and will consist of more than 160,000 solar panels. The park will provide enough power for 20,000 households. The project is financed by Commerzbank and Goldbeck Solar will build it. Construction will take approximately 6 months and the project will supply first power to the grid in October / November this year. The project was developed by Sunvest and Solar Proactive. Triodos Renewables Europe Fund recently joined as a financial partner. Sunvest and Triodos Renewables Europe Fund will build and operate the project together.
At the end of last year, Sunvest and Triodos Renewables Europe Fund also took over the Zuidbroek solar project from developer Van der Valk International. Zuidbroek Energie is 39 ha in size and will contain approximately 120,000 solar panels. The generation capacity of the park equals the electricity consumption of 15,000 households. Zuidbroek Energie is located along the A7 and next to the Van der Valk hotel Zuidbroek. Zuidbroek Energie is expected to be built in 2021/2022 as additional grid capacity must first be built in the substation at Meeden.
Rene Hanssen, director Sunvest: “We are very happy with this result. The development of Energiepark Duurkenakker was particularly complex due to the continuously changing environment with the construction of wind turbines and the nitrogen factory. Another special feature is that a large wind turbine will be located in the middle of the solar park, making efficient use of the location for the generation of sustainable energy.”
Vincent van Haarlem, Fund Manager Triodos Renewables Europe Fund : “In good cooperation with Sunvest, we can now enable the construction of these leading projects. With more than 280,000 solar panels, the realization of these solar parks is an important step towards the generation of more sustainable energy in the Netherlands and as such, an important contribution to catalyzing the much needed energy transition.”
News
North America offshore wind map
La Tene Maps
24 April 2020
See the distribution of offshore wind projects in North America in La Tene’s last edition of the North America offshore wind map.
View the map here:
Contact us or La Tene Maps to get a print copy of the map.
Article
Making floating wind bankable
A WORD ABOUT WIND
23 April 2020
Clément Weber gives his views on why non-recourse debt has never been raised for floating offshore wind to date and how to release it.
Recent development of floating offshore wind and promising market prospect: will finance be the bottleneck?
In 1991, the first offshore wind turbines were built in front of the Vindeby town in Denmark. It took 10 years to build a first commercial size project and 5 more years before private banks were able to take construction risk on a non-recourse basis, financing the Q7 project in the Netherlands. This first “project finance” milestone in an industry which is now mobilising a billion euros a month from senior lenders was only made possible by a combination of factors: in-depth due diligence of the technology, protective contractual structure, strong insurance coverage and contingency planning, tailor-made financial structure and a specific focus on interface risks. The floating offshore wind sector follows a similar route, with the first prototypes installed 10 years ago, pilot wind farms now under construction, commercial wind farms under development and an extraordinary potential of multi-GW yearly installation post-2030.
Firstly, are we sure that the pioneering expansion of floating offshore wind is all that new? Floating platforms have been used in the oil and gas sector for decades and applying them to a mature offshore wind sector could be seen as part of the natural incremental innovation of the industry. After all, lenders have closed billion-euro scale financings for offshore wind projects using (for most of them) a combination of brand new turbine models with only a few prototypes in the water, massive vessels just out of the docks, XXL monopiles 20% larger than the immediate previous generation and/or new installation methods.
How to make a floating offshore wind project bankable?
Although it is undeniable that its proximity to the fixed offshore wind sector will ease the learning curve, the answer is that the finance community currently considers floating technology as more than a simple evolution within an established sector. Structuring a project to raise non-recourse debt for the first floating offshore wind projects therefore needs to be done in a way that makes banks comfortable to unlock a whole new sector in the face of “unknown unknowns.”
What it means is that in addition to the usual bank requirements for offshore wind, developers must ensure that the following structuring features are carefully considered:
1. General – keep it simple: raising project finance for the first floating projects is a major ask and projects need to balance the novelty with an otherwise robust proposal: strong sponsors, experienced supply chain, low country sovereign risk, skilled project team and proven technology for the turbine, and limited or no revenue risk.
2. Technical – pick a proven technology: the lenders will favour the most proven technologies with prototypes already in the water, developed by solid counterparties. Despite IP concerns, a particular focus will be put on the transparency provided to the lenders’ technical advisor towards the review of the technology. Developers and technology providers should be ready to provide data from the existing prototypes. This will apply to all aspects of technology novelty (mooring, dynamic cables, potentially vessels) and not just to the floating foundation.
3. Contractual – target a healthy structure without loopholes: contracts will have to be particularly protective.
– A limited number of construction contracts (2 to 6) are preferred.
– Full-scope, fixed-price and long-term O&M contracts must be in place from financial close.
– Terms and levels of liquidated damages and guarantees need to be high.
– The interface risk will be scrutinised, with a focus on any gap remaining between the foundation and turbine contracts.
– The commitment of the floating manufacturer to ensure valid production conditions for the turbine (inclination, etc) will be specifically scrutinised.
4. Financial – find the optimum: the overall finance structure should not be too aggressive. Ample contingency budgets will be required to cater for cost overruns, or heavier than expected maintenance, as well as standard reserve accounts and debt sizing ratios on the conservative side.
5. Insurance – don’t forget the other risk takers: despite a risk analysis similar to what is done by the lenders, the insurance market is largely independent, yet essential. A few very specialised insurance advisors that have played a major role to make offshore wind insurable can now educate insurance parties to floating and projects should involve them without delay.
Current appetite in the debt and equity market?
On the lenders side, the EIB, a couple of ECAs and a handful of commercial banks have already received narrow credit committee approvals to lend to the right floating asset. Some projects will not reach the “bankability” trigger. Other projects with a structure in line with the recommendations above will attract these lenders and others. Those will be financed under terms that will remain fairly attractive: long term tenor, 60-70% debt-to-equity ratio, circa 2% margin.
The future of floating is bright, and one may fear that the imbalance between this limited funding currently available for the very best projects and the tens of GW to be financed would lead to a bottleneck. On the contrary, we believe that the initial pool of lenders will expand in parallel with the development of the sector, as the feedback from the first transactions will filter unfounded worries from the real challenges.
Blog post
Pay me to take my oil, please
Energy Blog
21 April 2020
Green Giraffe’s Managing Director Jérôme Guillet considers the impact of negative oil prices on the renewable energy industry.
Blog post
How green is your digital footprint?
Energy Blog
8 April 2020
The amount of CO2 you are saving by your valiant attempts to use reusable coffee cups is probably undermined every time you hit reply all and attach a video of that parrot to your company wide email.
The first commercially successful copy machine, the Xerox 914, was a red-hot new technology back in 1959 – so hot that the machine shipped with its own fire extinguisher due to its tendency to catch fire. The company labelled this accessory the “scorch eliminator”, but despite this, the copy machine went on to become one of Xerox’s most lucrative products.
Things have come a long way (and are hopefully safer) since then and we eagerly await the next technological step, the promise of the paperless office. This new utopia has been just around the corner since the mid-1970s. Going by the stacks of paper covering the desks of many there is still a long way to go, however email has at least made a big difference.
News
Saint-Brieuc sale
Press release
20 March 2020
Green Giraffe is now able to formally announce the sale of RES’s 22.5% stake in Ailes Marines to Spanish utility Iberdrola, which closed on 9th March. Ailes Marines is the special purpose vehicle developing the 496 MW Saint-Brieuc French offshore wind project. The project is permitted and has been awarded a feed-in tariff in round 1 of the French offshore wind tenders in 2012.
“Green Giraffe had supported RES during almost 3 years with a dedicated project team fully committed, responsive and providing high quality advice allowing RES to maximize its value “ commented the RES France Managing director. “We look forward to further supporting utilities and investors in the French offshore wind space and beyond” claims Jérôme Guillet, managing director of Green Giraffe. “Receiving full recognition of the commercial value of the project, even at an earlier development stage is at the core of what we do at Green Giraffe, to the great benefit of our clients”.
This marks the involvement of Green Giraffe in yet another French offshore wind farm, a market in which we now have considerable experience. Back in 2011, we supported Eolien Maritime France (EMF), owned at the time by DONG (now Orsted) and EDF EN (now EDF RE), when they were awarded 1.5 GW of offshore wind projects in auction rounds 1 and 2. In 2015, we were involved in a buy-side mandate with a strategic investor on the sale of a minority interest in EMF. In 2019, we successfully supported Sumitomo for the acquisition of a minority stake in two French offshore wind farms (Les Eoliennes en Mer), that were divested by Engie, EDPR and Banque des Territoires.
News
Clément Weber, co-chair of international floating wind committee
Press release
25 February 2020
We are pleased to announce that Green Giraffe’s floating wind expert Clément Weber will be co-chairing the WFO’s new Floating Offshore Wind committee, an international industry initiative, promoting the acceleration of commercial-scale floating offshore wind projects globally.
The WFO has launched the Floating Offshore Wind Committee as a new and truly international industry initiative, promoting the acceleration of commercial-scale floating offshore wind deployments around the world.
The Floating Offshore Wind Committee brings together not only international offshore wind industry leaders but also internationally recognized floating wind specialists – big and small – representing all aspects of the offshore wind value chain.
Clément’s appointment signals the industry’s recognition of Green Giraffe’s long-standing commitment to a sector that is now gaining significant momentum. The committee will be co-chaired by Bruno Geschier (IDEOL). Congratulations to WFO for the launch of this initiative and to Clément and Bruno for their nomination.
Blog post
Swimming against the tide – When will tidal energy take off?
Energy Blog
20 February 2020
Matthew Taylor outlines the hurdles to the tidal sector that have preventd it from becoming a mainstream energy source.
Blog post
Japan – an island nation with divine wind
Energy Blog
31 January 2020
Yurie Kawada discusses the opportunities and challenges for the up-and-coming Japanese offshore wind sector.
In an attempt to keep one of my New Year’s resolutions, I have been reading up on the history of Japan. While doing so, I was reminded of the most interesting fact that the once-invincible Mongol empire crossed the Sea of Japan twice in the 1270s and 1280s in a bid to conquer the world beyond China. Both times they were beaten due to strong winds and storms. In gratitude for this, the Japanese named the strong winds on their land the “divine wind” and huge weather events such as typhoons, tsunamis and earthquakes have always featured significantly in Japan’s history. Fast forward 750 years, and we now see that the weather is radically shaping the evolution of renewable energy in this densely populated island country.
As you will recall, the Great Tsunami of 2011 hit the eastern coast of Tohoku region and subsequently destroyed the Fukushima Nuclear Power Station, an event which caused enormous damage to the country. This, understandably, led to strong opposition towards nuclear power and subsequently all the Japanese nuclear power plants were halted in 2012. This left a big gap in the country’s energy mix as nuclear power had contributed 26% of the country’s generation capacity.
Article
Polish Offshore: On the Verge
PFI YEARBOOK 2020
6 January 2020
As politics and business come together to boost offshore wind in the Baltic sea, PFI asked Udo Schneider to author a piece in Yearbook 2020 on his view of the policies that are due to shape this flourishing industry.
Is Polish offshore wind about to be unlocked? Green Giraffe has been following the market for a long time and has been active over the years, we assisted in the recent sale of a portfolio of four offshore wind projects with a total generation capacity of more than 1.5 GW to RWE Renewables including the F.E.W. Baltic II project.
As a partner to Baltic Trade and Invest, Green Giraffe was responsible for the commercial structuring of the projects since 2017 as well as defined and executed the divestment strategy as exclusive financial advisors to the owners. A process that didn’t go without hurdles as key value drivers such as permitting status, access to grid connection and offtake routes have been and remain moving targets for most projects.
As politics and business come together to boost offshore wind in the Baltic sea, PFI asked Udo Schneider to author a piece in Yearbook 2020 on his view of the policies that are due to shape this flourishing industry.
Blog post
Thirsty work: is clean power the answer to clean water security?
Energy Blog
18 December 2019
Sebastian Reid proposes the coupling of renewable energy with desalination as a win-win solution for both developers and governments.
Over decades of investigation, the search for extra-terrestrial life has been based on a single principle; follow the water. Up to 60% of the human body is literally water, so life without liquid water seems as yet inconceivable.
Back on Earth, water is not hard to find – two-thirds of the planet covered by it. Yet London, Tokyo and Barcelona are some of the many cities expected to experience clean water shortages from 2025. Earlier this year, Indonesia announced it would move its capital from Jakarta, as the rapid depletion of the city’s groundwater resources is causing it to sink, displacing 10 million people. In 2017 and 2018 Cape Town suffered a severe shortage, with water levels dropping to 15% of dam capacity. Currently only 0.5% of the Earth’s water is fresh and accessible, and this resource, once thought plentiful, is being exhausted due to inefficient use of water resources combined with urbanisation and overconsumption.
Agriculture, in particular, has been put once again under the spotlight. 70% of all water demand derives from agriculture alone; a single beef burger has a water footprint of 2,000 litres, and 50 billion beef burgers are eaten each year in the US alone. To put it into perspective, a whopping 100 trillion litres of water per year are used to meet the burger needs of just 4% of the world’s population. Surely savings must be made.
Whilst management of water demand must improve, something can also be done on the supply side. Over 97% of the world’s water reserve is stored in our oceans, but in each kilogram of this water sits around 35 grams of dissolved salts which render this precious commodity unusable, a fact which leads us of course to desalination.
Presentation
Funding Energy From Waste (EFW) projects
3 December 2019
Energy from waste (EFW) projects are both very simple to develop and very easy to get wrong. Michael Ware has been advising on financing EFW projects for over 15 years and recently presented the attached slides to the SMI conference on waste in London. He talks through the 5 key requirements for a successful project and the 10 most common mistakes made by developers.
Presentation
Onshore wind financing landscape in France and Germany
22 November 2019
Yann Mouterde presented at the Geman and French onshore wind financing conference held by OFATE in Paris on 12 November. The presentation focused on the onshore wind financing landscape in France and Germany.
Blog post
Is National Grid’s Triad system past its peak?
Energy Blog
7 November 2019
Michael Ware discusses the information assymetry of the peak demand Triads system in the UK.
My surly next door neighbour has finally had enough of my barking dog and my two young sons kicking their footballs into his garden and is selling his house. Not particularly earth-shattering news, I know, but what is interesting is that he hasn’t advertised the asking price. If you want to make an offer, you have to call his estate agent for some sort of over-the-phone vetting process, after which they may or may not tell you quite how much he is asking for his 4 bedroom Victorian semi in a leafy street in Epsom. We know this because we tried – and they wouldn’t tell us.
This secrecy creates an information asymmetry which, as classic economic theory tells us, will impede the working of the market. My neighbour knows how much he wants to sell his house for – but the buyers don’t know his price and will probably be put off as a result. His paranoid behaviour is impeding the efficiency of his transaction and will cost him money in the long run. When I tried to carefully explain this over the fence whilst retrieving my son’s football he was a tad less than impressed.
News
Green Giraffe and Daiwa Securities enter 50:50 joint venture agreement
Press release
30 October 2019
Green Giraffe and Daiwa Securities today announced that they have entered into a 50:50 joint venture agreement.
Green Giraffe strengthens advisory capabilities and broadens access to international investors.
Green Giraffe will retain its independent management and its well-known brand in the renewable energy market and will be able to work closely with DC Advisory, Daiwa Securities’ specialist international M&A practice, and in particular with DC Advisory’s strong Infrastructure team. Green Giraffe and DC Advisory will be able to bring their complementary strengths and skills for all clients.
News
Sale of an offshore wind development portfolio in Poland
Press release
25 October 2019
Green Giraffe assisted in the development and sale of an 1.5 GW offshore wind development portfolio in Poland.
Green Giraffe is pleased to announce the successful closing of the sale of a portfolio of four offshore wind projects with a total generation capacity of more than 1.5 GW to RWE Renewables.
The projects, which are in different development stages, are all located around the Słupsk bank in the central Polish Baltic Sea. RWE Renewables acquired the respective project companies from private owners and developers with the intention to continue the development and to build & operate the projects.
As development partner Green Giraffe was responsible for the commercial development of the projects since 2017 and defined and executed the divestment strategy as exclusive financial advisors to the owners.
We are proud of having been able to make a sizable contribution to the development of the offshore wind sector in Poland. We wish RWE Renewables and the project team all the best with the realisation of the projects in the Polish Baltic Sea.
Presentation
Financial factors for the next tender in Taiwan
7th Asia Offshore Wind
22 October 2019
William Jackson presented at the 7th Asia Offshore Wind Day on 15 October in Taipei, discussing the key financial factors that will affect the next Taiwanese offshore wind tender.
William Jackson presented at the 7th Asia Offshore Wind Day on 15 October in Taipei, Taiwan.
The presentation looked back at how things stood from a financing perspective before the first Taiwanese offshore wind tender, looked at what has changed since the first tender and finally looked ahead to the next tender and discussed the factors that might affect it.
News
KFWind
Press release
18 October 2019
This week a consortium formed by EDP Renewables and Aker Solutions entered into Korea Floating Wind Power (KFWind) alongside founding shareholder WindPower Korea to develop an initial project of 500 MW floating offshore wind in the region of Ulsan City in South Korea.
This week a consortium formed by EDP Renewables and Aker Solutions entered into Korea Floating Wind Power (KFWind) alongside founding shareholder WindPower Korea to develop an initial project of 500 MW floating offshore wind in the region of Ulsan City in South Korea. Principle Power, which had a role in originating the KFWind project portfolio, will supply its WindFloat foundation technology for the project.
Green Giraffe acted as financial advisor to KFWind to raise equity for funding of the development of the 500 MW floating offshore wind project.
We are very excited to consolidate our presence both in Asia and in the floating wind industry, and we look forward to seeing South Korea join the offshore wind adventure.
Blog post
Thinking twice about the future of transport
Energy Blog
14 October 2019
In George Orwell’s scarily prescient novel “1984”, he introduces the concept of doublethink: the ability to hold two apparently contradictory thoughts at the same time, e.g. my wife fancies the svelte, densely coiffured actor Hugh Jackman but has actually married me, a fat bald accountant.
On a less personal scale, the UK Government’s approach to transport seems to be a classic example. They proudly proclaim no new cars or vans powered solely by a petrol or diesel engine will be sold in the UK from 2040 – but at the same time they spend the best part of GBP 500 M per annum on incentivising technology to produce diesel and gas from bio sources such as crops and waste. This is through the somewhat clunkily titled Road Transport Fuel Obligation scheme (RTFO).
News
Houat sale
Press release
9 October 2019
We are very proud to have assisted Vol-V on the sale of its onshore wind and solar arm to CNR (la Compagnie Nationale du Rhône), a French IPP.
We are very proud to have assisted Vol-V on the sale of its onshore wind and solar arm to CNR (la Compagnie Nationale du Rhône), a French IPP.
A team of talented and highly skilled renewable energy specialists will reinforce CNR’s existing capabilities and leading position in the French market. This agreement also increases CNR’s portfolio by approximately 1.7 GW project pipeline in various stages of development.
The transaction was signed on 13 September, Green Giraffe acted as exclusive financial advisor to Vol-V on this sale.
News
Windpark Fryslân reaches financial close
Press release
2 October 2019
Green Giraffe advised on the EUR 700 M debt raise for Windpark Fryslan, the 383 MW nearshore wind farm, located in the IJselmeer in the Netherlands.
Green Giraffe provided financial advisory services to Windpark Fryslân for the development of the 383 MW nearshore wind farm in the IJselmeer, the Netherlands. The project reached financial close on 1 October 2019. Senior debt of around EUR 700 M was provided by a lenders group of 10 banks consisting of ABN AMRO, BNG, BNP Paribas, DZ Bank, Helaba, ING, KBC, KfW IPEX, NWB and Rabobank. On financial close the province of Fryslân stepped in as a shareholder with a total investment of EUR 100 M. After completion of construction, inhabitants of the province will be given the opportunity to invest in the windfarm through bonds.
Once operational in 2021, the project will be the world’s largest windfarm on a lake. This is another milestone in the lake’s interesting history: the former complex of lakes was flooded by the North Sea, then later closed off again by a 32-kilometer dam and partly drained to create an entire new province with fertile farmland. The area will now additionally supply 383 MW of electricity per year, enough for 500,000 households and 70% of the province of Friesland’s wind energy target. The wind turbines will be located just south of the long dam called Afsluitdijk. The project includes the construction of a nature island further along the Afsluitdijk. The island will be a resting and foraging area for birds and fish. During the construction of the project it may be used as work island.
Blog post
Hydrogen – A Green Future is not Blue
Energy Blog
27 September 2019
Niek Schumacher reflects on the hype around hydrogen and how its business case could be made green.
As you might remember from chemistry lessons at school, hydrogen is both the lightest element in the periodic table and constitutes 75% of the mass of the universe. And despite being such an innocuous little molecule, it is about to play a third major role in the energy revolution. The recent hype around hydrogen as the Holy Grail of the energy transition is mainly thanks to its incredible versatility; enabling it to replace fossil fuels in mobility, heating and electricity generation and serve as a low-carbon feedstock for industrial processes. Though hydrogen is currently not playing the role some might foresee it having in the future, it is important to note that the petrochemical and fertilizer industry are already consuming enormous volumes of the stuff. Unfortunately for Mother Nature, this hydrogen is produced using natural gas, a process which causes significant carbon emissions. On a global scale this so-called grey hydrogen is responsible for almost 2% of worldwide emissions, more than the carbon emissions in the UK.
Blog post
E-scooters – the next big thing or just eco bling?
Energy Blog
31 July 2019
Daniel Marshall looks at the growing use of electric scooters on the streets of Paris and the challenges we face integrating green transport in our cities.
Blog post
Is the revolution in battery storage at risk of going flat?
Energy Blog
26 July 2019
Michael Ware challenges some assumptions about the role of battery storage in the future.
Blog post
Are car charging points today’s equivalent of Levi jeans?
Energy Blog
28 June 2019
Michael Ware discusses Levi Strauss and the future of electric car charging.
News
Gordon Butte Pumped Storage
Press release
27 June 2019
Green Giraffe advised on the sale of Absaroka’s 400 MW Gordon Butte pumped storage hydro project, successfully closing the transaction with a European investment fund.
Copenhagen Infrastructure Partners, through Copenhagen Infrastructure III K/S, have invested in Absaroka Energy’s pumped storage hydro energy project in Montana, USA. The 400 MW Gordon Butte Pumped Storage Project represents a carbon-neutral way to help balance the grid in the Pacific Northwest, and will be ready for construction in early 2020 – the first new pumped storage project developed in 30 years. Green Giraffe co-advised on the transaction, which reached financial close in June 2019
The Gordon Butte project is sited in Meagher County, located about three miles west of Martinsdale and less than six miles from its interconnection to the Colstrip twin 500 kV transmission lines, the backbone of the Pacific Northwest’s electric system. This interconnection location will give the facility access to markets in Montana and throughout the region. The project will have minimal environmental impact due in large part to the closed loop nature of the siting and design thus taking the facility out of an existing stream or water impoundment. Capital expenditures to build and operate the project will inject meaningful resources into the state and local economy
Presentation
Seminar: Financing Floating Offshore Wind
Floating Offshore Wind Seminar
12 June 2019
On 6 June 2019, Green Giraffe, in cooperation with RCG and WFW, organised a seminar on the current state of play of the floating offshore wind market.
Moderated by our very own Clément Weber, a panel composed of Igor Silence (Codan), Guillaume Faure (Quadran Energies Marines), Benoîte Chenut (EDF Renouvelables) and Inocencio Figaredo (EIB) described the status and prospects of the sector, as well as the financing strategies and constraints. We are grateful to the members of the panel for the quality and intensity of the discussion.
Green Giraffe’s presentation “Financing floating offshore wind” is available to download here.
News
EnBW closes the acquisition of VALECO
Press release
4 June 2019
Green Giraffe advised EnBW on the acquisition of the French developer and operator of wind and solar farms VALECO.
The authorities and the French Minister for the Economy and Finance give the green light to the full acquisition of the French developer and operator of wind and solar farms
EnBW aims at turning VALECO into one of the Top 5 players in the wind and solar market in France in the medium term
Karlsruhe/Montpellier. After having received the final official approvals, EnBW Energie Baden-Württemberg AG closed the acquisition of the French developer and operator of wind and solar farms VALECO on 3 June 2019. EnBW’s bid was previously accepted in a highly competitive field of bidders. The acquisition strengthens EnBW’s activities in the renewable energy sector over the long term as a key future business area for the company and at the same time secures growth opportunities in one of the most important markets for renewable energy in Europe.
“The acquisition of VALECO marks a significant step forward in the rigorous expansion of EnBW in renewable energy to make them one of the main pillars of the company. In addition, the target of reaching 1,000 MW of installed capacity in the onshore wind sector by 2020 has now nearly been achieved. With VALECO, we now have one of the most experienced players on the French renewable energy market at our side. We will exploit the growth opportunities together and become one of the Top 5 players on the French wind and solar market in the medium term as strong partners”, emphasised EnBW CEO Frank Mastiaux. Hans-Josef Zimmer, Chief Technical Officer, added: “EnBW and VALECO fit very well together. We are delighted to now have our new colleagues from France on board. And we are looking forward to future cooperation and numerous joint projects.”
VALECO is based in Montpellier and is one of the Top 10 operators of renewable energy farms on the French market. The company employs around 135 people in the onshore wind and solar sectors and is active along the entire value added chain throughout France from development and construction through to operation. With an installed capacity of 276 megawatts of onshore wind power and 56 megawatts of solar power, as well as a project pipeline of 1,700 megawatts, VALECO reported an annual turnover of around 50 million euros last year. Alongside the company headquarters in Montpellier, VALECO also has project development offices in Amiens, Nantes and Toulouse.
The previous owners of VALECO were the founding family Gay and the bank Caisse des dépôts et consignations (CDC).
Erick Gay: “EnBW was the most suitable player for VALECO to continue its story as an independent and integrated player within the French market. The steady growth of VALECO was requiring a scale-up in terms of processes and funds to support the impressive pipeline developed over the last years. With EnBW, VALECO is now ready to follow on the entrepreneurialadventure launched by my family and turned into one of the main renewable energies French player thanks to its employees. I am particularly proud of what we have done with all our stakeholders and wish VALECO, EnBW and its employees the best for their future.”
Olivier Sichel, CEO of Banque des Territoires:“As a leading public financial institution involved in the renewable energy market in France, Banque des Territoires has been supporting VALECO’s development for 10 years. VALECO’s growth was a real success and we considered it was the right moment to sell our stake along with Holding Gay. Banque des Territoires is convinced that EnBW industrial project is really relevant to further support the growth of the company and the development of its teams. Banque des Territoires, as a public investor, is proud of the work accomplished, alongside the VALECO Group’s teams over the years. This is a good example of how we are helping the economy of our regions.”
The acquisition of VALECO increases the renewables portfolio of EnBW by an impressive 31 percent right from the start – and will also make an immediate contribution to the EnBW Group’s operating result. Over the last few years, EnBW has already installed more than 1,200 megawatts of generation capacity from renewable sources.
EnBW has invested around three billion euros to date in the expansion of renewable energy as part of its strategy EnBW 2020 . The company plans to invest more than five billion euros by 2025 in the further expansion of renewable energy in Germany and selected foreign markets. Since 2018, EnBW has been active itself in France and has been developing the onshore wind and solar business together with its subsidiary EnBW Energies Renouvelables SAS.
EnBW is one of the largest energy companies in Germany and Europe with a workforce of more than 21,000 employees. It supplies electricity, gas and water, as well as energy solutions and energy industry services, to around 5.5 million customers.
The full press release is available here.
Blog post
Green Giraffe across the pond: opening our Boston office
Energy Blog
23 May 2019
Randy Male, director of Green Giraffe’s new office in Boston, discusses expansion plans across the Atlantic.
Presentation
Wind of change: Finance, regulation, deeptech
9th New Energy Investor Summit
20 May 2019
Invited to speak at the 9th New Energy Investor Summit in Zurich, Aurélie Dethan comments on finance, regulation and technological innovation trends affecting the offshore wind industry.
Blog post
Is energy from waste the next big investment opportunity?
Energy Blog
18 April 2019
The renewables industry has, in part, become a victim of its own success in this regard. Globally over GBP 1 trillion has been invested in projects in the last then years.
Presentation
Recent trends in offshore wind finance
4 April 2019
Jerome Guillet presented “Recent trends in offshore wind finance” at the Thought Leaders Forum hosted by MHI-Vestas within the WindEurope exhibition in Bilbao on 4 April 2019.
This is a fully updated version of the presentation we regularly make at events and conferences on the topic and covers both equity and debt, with a description of the most recent terms and conditions to fund the sector in the context of the move to highly competitive tenders and merchant bids in some countries.
Jérôme Guillet co-founded Green Giraffe in 2010 and was a Managing Director until 2021.
News
Greener Power Solutions signed battery financing
Press release
2 April 2019
On 2 April 2019, Greener Power Solutions signed the financing of a first batch of 330 kW mobile batteries from Alfen, the Dutch battery manufacturer.
The batteries will be used to provide power to off-grid locations such as festivals, concerts or construction sites. When not used on such temporary missions, the batteries will be connected to solar PV plants to assist in grid balancing and production optimization, and to be recharged with clean energy. The set-up allows for clean power to be delivered to off-grid locations much more cheaply than traditional diesel generator power, while at the same time avoiding the related emissions and pollution.
Green Giraffe acted as financial advisor to Greener under a long term advisory and cooperation agreement and is proud to help this transition to cleaner energy in out-of-reach areas!
Greener and Green Giraffe further entered into a long term advisory and cooperation agreement to structure and finance the acquisition of additional tranches of batteries, ranging in capacity from 120kW to 600kW, to Greener’s fleet in the next two years, and expect that the range of services provided by such batteries can only increase over time.
Lukas Kuijken from Greener:
“This is an important step in the decarbonization of the off-grid energy market and vital for realizing the energy transition. The cooperation with Green Giraffe ensures knowledge sharing, rapid growth, and sustainable innovation.”
Niels Jongste from Green Giraffe:
“We are extremely pleased with this long term cooperation. Greener demonstrates that (economically) viable solutions are rapidly becoming available to integrate clean power solutions in off-grid situations.”
News
Infographic: 9 years of success for Green Giraffe
Press release
1 April 2019
Just before its 9th anniversary, Green Giraffe attended the 2019 WindEurope Conference in Bilbao and prepared an updated infographic for that occasion, showing our track record and company highlights.
2018 was another busy year, and Green Giraffe’s 9th year ended with a party for our clients at the Bilbao Guggenheim Museum and the announcement of the opening of our second office outside Europe, in Boston (USA)
News
Veja Mate announces divestment
Press release
13 February 2019
On 13 February 2019, the divestment of an 80% stake of the 402 MW Veja Mate offshore wind farm was successfully closed. Green Giraffe advised Highland Group Holdings, Siemens Financial Services and Copenhagen Infrastructure Partners on the sale.
Presentation
Poland: Offshore wind – Energising an industry
Windforce Conference Gdansk
13 February 2019
Udo Schneider discussed the investor’s perspective on offshore wind at the recent Windforce conference in Gdansk, Poland, touching on how value is created and how the varying support regimes compare.
Udo Schneider, director of Green Giraffe’s Hamburg office, presented “Offshore wind – Energising an industry” at the recent Windforce conference in Gdansk, Poland. He discussed the investor’s perspective on offshore wind, touching on how value is created and how the varying support regimes compare.
The presentation is available here.
Presentation
Early development stage funding in offshore wind
5th Asia Offshore Wind day, Tokyo
24 January 2019
Learning from the European experience – how to attract development stage funding for Asian offshore wind.
Although offshore wind has had a relatively long and successful history in Europe, the parallel market in the promising waters of Asia and Japan is only just beginning. The combination of new jurisdictions, new regulations and inexperienced supply chains makes this a challenging environment for developers and nervous investors are pricing risks accordingly. In this presentation, Sophie Cherrier talks through the typical contracting structures used in European offshore wind projects, the three key stages of development funding and the risks faced by investors at each stage. She uses her extensive experience of advising on successful projects to illustrate which specific investors will be attracted at which stage of development and how developers can successfully mitigate risks to bring in external finance whilst enhancing value creation.
News
ENGIE and EDPR sign an alliance with Sumitomo
Press release
18 December 2018
ENGIE and EDPR sign an alliance with Sumitomo Corporation for the development of offshore wind projects in Yeu-Noirmoutier and Dieppe-Le Tréport, France.
As part of the alliance, Sumitomo Corporation acquires a 29.5% equity stake in the French offshore projects (Dieppe Le Tréport and Yeu Noirmoutier) and will bring to the consortium its proven and complementary offshore wind expertise in terms of development, construction and operation.
ENGIE remains the reference shareholder with a 31% stake and the leading industrial player of both parks (496 MW each), in partnership with EDPR (29.5%) and La Banque des Territoires (part of Groupe Caisse des Dépôts, 10%).
Sumitomo Corporation is a leading Japanese industrial group already strongly positioned in the wind energy sector in Japan, Europe, United-States, South-Africa and China. The company is also part of some major offshore wind projects in Belgium and in the United Kingdom, totaling an installed capacity of over 1.5 GW
Sumitomo Corp is also one of ENGIE’s long-time trusted partners and co-investors in desalination and geothermal projects in the Middle-East and Indonesia.
Socio-industrial commitments remain confirmed. This new alliance underlines the attractiveness of the French offshore wind market and the implementation of a French Marine energy sector.
Presentation
Financing floating offshore wind projects
Floating Offshore Wind UK
30 November 2018
After years of development and a few false dawns, 2019 is likely to be the year when floating wind becomes a reality
Although floating wind turbines have long since been regarded by governments worldwide as the natural end point for the renewables industry, their deployment to date has been slow and expensive. Despite the obvious benefit of access to deeper waters and better wind speeds, floating platforms have been warily regarded by institutional investors as unproven and highly speculative compared to their fixed cousins. This paradigm is now changing and there are at least 5 floating operational projects worldwide that are proving the concept and opening the door for mass deployment in the coming years. In the attached presentation, Clement Weber talks through the latest advances in this technology and how project sponsors who may have missed out on the low hanging fruit of fixed platform opportunities can access early stage equity and later stage debt to build out their projects.
Presentation
Equity and debt in Taiwan offshore wind
2nd annual Taiwan Offshore Wind Energy Summit
7 November 2018
Equity and debt in Taiwan offshore wind.
Blog post
Why we opened an office in Cape Town
Energy Blog
31 October 2018
Henri Gouzerh (head of Cape Town office) explains the rationale for opening an office in South Africa, the challenges faced over the past 12 months and the opportunities it brought Green Giraffe.
At the end of 2017, Green Giraffe opened an office in Cape Town, South Africa. In this post we discuss why the time was right for the move, how we got there, and highlight some of the opportunities in the South African and the wider African markets.
Presentation
Offtake considerations in today’s RE world
19 October 2018
On 16 October 2018 Clément Weber, presented at the Green Giraffe / Linklaters Corporate PPA panel in Paris. The presentation examined recent trends and structures in offtake agreements in renewable energy (including a focus on corporate PPAs).
Presentation
Offshore wind debt capacity in Taiwan
4th Asia Offshore Wind Day
18 September 2018
Sophie Cherrier presented at the 4th Asia Offshore Wind Day in Taipei, Taiwan on 18 September. The presentation looked at the Taiwanese offshore wind market with a focus on risks and opportunities for debt funding of Taiwanese offshore wind projects.
Presentation
Who will fund US Offshore Wind – and on what terms?
Infocast Offshore Wind Implementation Summit
7 September 2018
On 7 September 2018 Jérôme Guillet, Managing Director of Green Giraffe, presented at the Infocast Offshore Wind Implementation Summit in Teaneck, NJ. The presentation examined the risks and equity strategies seen in offshore wind, discussed the potential debt providers and gave predictions for the funding of future US offshore wind projects.
Jérôme Guillet co-founded Green Giraffe in 2010 and was a Managing Director until 2021.
News
L2Fiber Rotterdam partners with Highland in optical fiber
Press release
26 July 2018
Highland has entered into an exclusive agreement to invest in L2Fiber Rotterdam. The company plans to bring optical fiber access to all 295,000 homes in Rotterdam over the next 5 years.
News
Acofi Gestion closes refinancing of 80 MW solar & wind portfolio
19 July 2018
Green Giraffe is proud to announce the closing of the EUR 127 M refinancing of an 80 MW portfolio of renewable assets located in France and managed by Acofi Gestion!
This adds a new milestone to our collaboration and work for Acofi Gestion, a leading French fund manager with EUR 2.6 bn under management.
The portfolio comprises a mix of solar PV ground mounted parks, rooftops and greenhouses and onshore wind projects commissioned between 2013 and 2016.
The new financing replaces the existing senior term loans at SPV level through a unique holding level financing, benefiting from the portfolio’s track record, improved market conditions and providing for simplified administrative and reporting requirements.
The refinancing ultimately involved Société Générale as Mandated Lead Arranger, Lender and Hedging Bank and BPI for a total refinancing amount of ca. EUR 127 M, including the term loan and the debt service reserve facility. The process between lenders selection and financial close only lasted 29 days, once again demonstrating Green Giraffe’s high level of efficiency and ability to streamline financing processes!
News
Deutsche Bucht will install two turbines on Mono Buckets
Press release
19 July 2018
Northland Deutsche Bucht GmbH announced today that the Deutsche Bucht Mono Bucket pilot demonstrator project has reached financial close.
News
Veja Mate debt restructuring
Press release
5 July 2018
The Veja Mate offshore wind farm (402 MW) has successfully restructured its EUR 1,277 M senior debt facilities with its existing lender group.
Green Giraffe and FIH Partners, acting as exclusive financial advisors, are pleased to announce the successful and favorable closing of the restructuring of EUR 1,277 M senior facilities in place on the Veja Mate project.
Veja Mate is a 402 MW offshore wind farm located in the German North Sea, approximately 95 km off the island of Borkum. It is owned by Highland Group Holdings Ltd, Siemens Financial Services and CI II managed by Copenhagen Infrastructure Partners.
All 67 Siemens turbines were successfully commissioned in May 2017, take-over occurred in October 2017 and project completion was reached early February 2018.
The initial transaction successfully closed in June 2015, with Green Giraffe advising Veja Mate in raising EUR 1.9 bn of funding through long term non-recourse financing senior debt, subordinated debt and equity. FIH Partners advised Copenhagen Infrastructure Partners on their investment in the project.
News
Financial Close Borssele III/IV
Press release
28 June 2018
The Blauwwind Consortium announced Financial Close on the Borssele III/IV wind farms in the Dutch North Sea.
The Blauwwind Consortium today announced Financial Close on the Borssele III/IV wind farms in the Dutch North Sea. This sets in motion the construction and subsequent operation of 77 V164 9.5 megawatt (MW) turbines produced by MHI Vestas, with a total installed capacity of 731.5MW, enough to power some 825,000 households*. Total expected production is 3,000 gigawatt hours (GWh) per year. The main construction work is due to start in the fourth quarter of 2019, with commercial production expected in early 2021.
The consortium partners are Partners Group** (45%), Shell (20%), DGE*** (15%), Eneco Group (10%) and Van Oord (10%). Shell and Eneco Group have also secured 15-year Power Purchase Agreements (PPAs) from the Consortium, under which each will buy 50% of the power generated by the wind farms. Van Oord will execute the “Balance of Plant” for the project, consisting of the engineering, procurement and construction of the foundations and inter array cables. The offshore substation Borssele Beta will be designed and constructed by TenneT.
During the first 15 years of operation, Blauwwind will receive a guaranteed price of €54.49/MWh under the Dutch SDE+ scheme, after which the power will be sold at prevailing rates in the wholesale power market. The project capex for the construction phase is €1.3 billion, part of which will be funded through project finance.
“I am proud of the team that executed the tender and development phase of this project both professionally and passionately,” said Erik de Boer, Project Director Blauwwind responsible for the phase up to Financial Close. Roeland Borsboom has been appointed as Project Director for the phase up to realisation and will now work to continue the momentum behind Borssele III/IV keeping a focus on safety and a high quality business case.
“Borssele is an attractive opportunity to invest in a high-quality offshore wind project alongside experienced partners,” said David Daum, Senior Vice President, Private Infrastructure Europe, Partners Group. “With the Dutch government committed to achieving 16% of its energy production from sustainable sources by 2023 as part of a National Renewable Energy Action Plan, we believe the project is both timely and critical in helping the country achieve that aim.”
“Offshore wind has the potential to be by far the largest renewable resource in the North Sea. Borssele III/IV will allow us to demonstrate our expertise and experience of large, integrated offshore projects,” said Mark Gainsborough, Executive Vice President, New Energies at Shell. “This important investment demonstrates Shell’s commitment to invest an average of $1-2 billion a year until 2020 in new and fast-growing areas of the energy industry.”
“We are delighted to achieve this important milestone and pleased that we are one step closer to make this innovative offshore wind project come true.” said Keiichi Suzuki, CEO of Diamond Generating Europe (DGE). “This milestone helps DGE to increase its presence in the renewable energies sector, which leads to the achievement of DGE’s mission of ‘providing clean and smart energy to everyone’.”
“In addition to executing the Balance of Plant contract, Van Oord is also a consortium partner, owning a 10% equity stake in this project,” said Pieter van Oord, CEO of Van Oord. “This involvement illustrates our commitment in advancing the development of sustainable energy. Building this offshore wind project is an important step forward in meeting the climate objectives of the Dutch government.”
“The financial close of Borssele III/IV is an extraordinary milestone,” said Kees-Jan Rameau, Chief Strategic Growth Officer at Eneco Group. “It means that even at this record-breaking low subsidy level, our offshore wind project is attractive enough to allow adequate returns for the equity and debt financing. Eneco has contracted 50% of the green electricity output of this windfarm, which contributes significantly to Eneco’s primary goal: to provide even more locally generated green power to our customers.”
“Borssele III/IV is a landmark project for offshore wind and for MHI Vestas,” said MHI Vestas CEO, Philippe Kavafyan. “Building on our strong track record in the Netherlands, we are delighted to bring the V164-9.5 MW turbine, the world’s most powerful available turbine, to Dutch waters. In doing so, MHI Vestas is proud to help the Netherlands remain at the forefront of competitive offshore wind power generation.”
* Based on calculations of 700MW x 4.000 hours = 2.800.000 MWh : 3.400MWh = 823,529 households.
**Partners Group is investing on behalf of its clients.
***DGE is a fully owned subsidiary of Mitsubishi Corporation which develops, constructs and operates assets generating 5GW (gross) of power in Europe and the Middle East. Mitsubishi Corporation is one of the largest Japanese investment and trading companies and pursue not only economic value but also social and environmental value on the global basis.
Link to press release on Van Oord website
News
Infographic: 8 years of success for Green Giraffe
Press release
27 June 2018
Green Giraffe celebrated the 8th anniversary and prepared an updated infographic showing our track record and company highlights.
2017 was another great year with a record number of deals closed and the momentous step of opening our first office outside of Europe, in Cape Town, South Africa
The infographic can be viewed here.
News
EnBW steps in US market for offshore wind
Press release
11 June 2018
EnBW is continuing its strategy to capture growth in new international markets in the renewable energy sector. EnBW and Trident Winds have formed a joint venture to develop an offshore wind project in California.
Presentation
Auction design and finance in offshore wind
Windforce 2018
16 May 2018
Our managing director, Jérôme Guillet, spoke at the Windforce 2018 conference in Bremerhaven. The main topic of his presentation was the differences in offshore wind auction designs and their implications on offtake and financing structures.
Jérôme Guillet co-founded Green Giraffe in 2010 and was a Managing Director until 2021.
Article
Leading voices in floating wind explore challenges ahead
RECHARGE
30 April 2018
Recharge News has prepared a special report on floating wind on the occasion of the Marseilles FOWT2018 conference and we were asked to provide a contribution.
Recharge News has kindly authorized us to make their report available for download and to copy below the contribution on the bankability of the sector prepared by Jérôme Guillet, one of our Managing Directors, and Martin Guzzetti, who made an associated presentation on the topic at the Marseilles event.
News
Taiwan: the next offshore wind gold rush
Inspiratia
12 April 2018
Green Giraffe’s Sophie Cherrier talked to inspiratia about the opportunities and challenges facing the Taiwanese offshore wind market.
Appeal of Taiwan:
“With the new dynamics of the European renewable markets – increasing liquidity, competition and the drop in tariffs – a number of developers have started to look at what else might be available.”
On pricing:
Cherrier explains that “a number of regulatory constraints” apply around the amount that local banks and international banks with local branches can provide.
“This puts pressure on the overall amount each project can raise as there is a lot of competition and a lot of local currency funding needed over a similar timeline, and is also why you need experienced sponsors and advisors who know how to raise these types of complex financings.”
“As the risks are better understood and the market gets more liquid, I think pricing should follow the same trend as the European markets.”
On participation of ECAs:
“It makes sense for ECAs to look at new markets, especially those open to imports from European countries like Taiwan, where they can take risks commercial banks can’t, at the early stage and bring additional (risk) liquidity for projects. Generally, their participation also gives more comfort to commercial lenders and helps to increase lenders’ appetite.”
Insurance companies:
“In Taiwan, insurance companies can’t take construction risk due to regulatory constraints. They’re interested, but their actual appetite is still to be tested.”
PPA:
“The PPA template is used for all projects in Taiwan and in its current short form. It lacks a number of clauses that sponsors and international lenders would typically want to see in the contract.”
New Asian offshore markets
“South Korea and Japan in the medium-term are the obvious candidates and they add a future and relevant pipeline for contractors, which makes it even more worthwhile for them to pay the price of the learning curve.”
The full article is available here
Article
Consortium excited with winning tender for Borssele V
Press release
6 April 2018
The Two Towers consortium, consisting of Van Oord, Investri Offshore and Green Giraffe, has won the tender for Borssele Wind Farm Site V. MHI Vestas Offshore Wind is the preferred supplier for the wind turbines.
Consortium excited with winning tender for Borssele V
Rotterdam, The Netherlands, 6 April 2018 – The Two Towers consortium, consisting of Van Oord, Investri Offshore and Green Giraffe, has won the tender for Borssele Wind Farm Site V. MHI Vestas Offshore Wind is the preferred supplier for the wind turbines.
Borssele V has been designated as an innovation site, situated within site III of the Borssele Wind Farm Zone. The offshore wind farm is located more than 20 kilometres off the coast of Zeeland, the Netherlands and consists of two turbines of 9.5 MW each. Once operational in 2021, the 19 MW offshore wind farm will provide sustainable energy to 25,000 households. Van Oord is responsible for the design and the offshore works, while Green Giraffe will assist in the project management and financing of the project. Investri Offshore provides the project director.
News
Offshore wind navigating into new territory
INSPIRATIA BRIEFING'S KEY TAKEOUTS
12 March 2018
Jérôme Guillet participated in a panel at an inspiratia briefing hosted by Moody’s Investors Service. The experts discussed investment structures and financial engineering required to deal with increasing exposure to merchant risk.
News
Construction Solarpark Scaldia commences
Press release
19 February 2018
Solarpark Zeeland BV and ib vogt are pleased to announce that the construction of Solarpark Scaldia, the largest solar energy park in the Netherlands, will start at the end of this month.
Construction commences for the largest solar park in the Netherlands
Solarpark Zeeland BV and ib vogt are pleased to announce that the construction of Solarpark Scaldia, the largest solar energy park in the Netherlands, will start at the end of this month.
Last Friday the shares of Solarpark Scaldia were transferred by the developer Solarpark Zeeland to the new owner ib vogt, who will also build the park. Enduris will start construction of the grid connection at the end of February. At the beginning of April ib vogt will start preparing for the installation of the first solar panels. ib vogt aims to have the park ready mid-August and commission it in September.
Largest solar park in the Netherlands
Solarpark Scaldia will consist of about 140 thousand solar panels on 40 hectares (80 football fields) in the cable and pipeline corridor around the Sloehaven in the municipalities of Borsele and Vlissingen. This 50 megawatt solar park can supply power industrial and residential users in the region and thus contributes to increasing renewable energy in the immediate vicinity. The project requires an investment of approximately 40 million euros. Solarpark Scaldia beats the largest solar energy park in the Netherlands, SunPort Delfzijl, in terms of both area and capacity. Sunport Delfzijl has a capacity of 32 megawatts and, like Solarpark Zeeland, has been initially developed by Hans Hoven.
Generation to start towards the end of 2018
Today Hans Hoven, director of Solarpark Zeeland, the company that developed the solar farm, and Carl von Braun, managing director of ib vogt, signed the documents for the transfer of the project. ib vogt wants to start generating at the end of this year.
Intensive development path to an innovative project
In 2015 a preliminary land agreement was signed with Zeeland Seaports and two private land owners. The building permit was obtained mid-2016, after which an SDE+ award of 15 years was granted to the project. Two thirds of the park are located on the territory of Borsele, the rest in Vlissingen. The park is also under the high-voltage lines of Tennet. Due to its location, the development of the park has been very complex. The park will be built with the solar panels in an innovative east-west direction. This ensures more efficient land use and a better daily generation profile. Municipalities Borsele and Vlissingen have always supported the initiative, as well as ZMF (Zeeland Environment Federation), in the person of Tjeu van Mierlo. Green Giraffe supported Solarpark Zeeland during the development phase by obtaining all permits and consents, negotiating the contracts and selling the project.
Quote by alderman Ad Schenk, municipality of Borsele
“The arrival of Solarpark Scaldia is a fantastic boost. The project is innovative and will be built in a special location in the cable and pipeline corridor of the port. It provides power for 30,000 households, has a strong appeal for the establishment of new, sustainable companies in the port and offers opportunities for involving our residents through cooperatives. “
Quote by alderman John de Jonge, municipality of Vlissingen
“It is great that the city with the most hours of sunshine can also build the largest solar park. The largest offshore wind port can now largely run on solar energy. That is really sustainable. ”
Quote from Peter Geertse, Zeeland Seaport
“As a port, we are proud of this development and impressed by the professionalism and effectiveness of the Solarpark Zeeland developers. We wish the operator and investor ib vogt a lot of Zeeland sunshine hours. “
Presentation
Bankability risk analysis of floating offshore wind
Floating Wind Seminar
6 February 2018
On 6 February, Green Giraffe and DNV GL organized in collaboration with Linklaters a seminar about floating offshore wind, where the status and commercialization prospects of this nascent sector were debated in front of a large audience including bankers, investors, contractors and industry advisors.
Clément Weber and Martin Guzzetti introduced the successful collaboration between Green Giraffe and Principle Power, focused on risk analysis of the WindFloat technology. They explained the risks involved in the development and construction of an hypothetical floating wind farm using the WindFloat technology and how these could be mitigated for investors and lenders. The case study included contractual and technical mitigation solutions capable of optimizing the total project risk exposure, and it can serve as a functional model to assess the bankability of current and future floating offshore wind farms.
Green Giraffe’s presentation was followed by a speech from DNV GL about certiication of floating offshore wind turbines and by a panel comprising various sector experts from Eolfi, Engie, MHI Vestas and Saipem.
Article
Green Giraffe and Cathay United Bank co-mandated in Taiwan
Press release
1 February 2018
Green Giraffe has been mandated as lead international financial advisor alongside Cathay United Bank as local financial advisor for the Hai Long 2 & 3 offshore wind projects in Taiwan.
Located in the Taiwan Strait, the projects could reach around 1 GW and are owned by Yushan Energy (40%) and Northland Power (60%). The projects have successfully passed the EIA (environmental impact assessment) in 2017 and will participate in the Taiwanese selection process and submit an application on March 30, 2018 with the aim to receive a feed-in-tariff and grid connection.
John Pires, Vice President, Head of M&A and Project Finance at Northland Power Inc. said “Northland Power Inc. is excited to once again work with Green Giraffe, our long-standing partner for offshore wind project finance advice. Similarly, we are equally excited to work with and start a new relationship with Cathay United Bank, one of Taiwan’s leading private banks. Along with our partner Yushan Energy Co. Ltd., we feel that Green Giraffe’s extensive offshore wind project finance experience, coupled with Cathay United Bank’s strong Taiwan banking knowledge, is an exceptional partnership that will position the Hai Long 2 and Hai Long 3 projects to succeed in Taiwan.”
These projects would directly contribute to Taiwan’s goal to develop up to 5.5 GW of renewable energy by 2025.
Tsung-hua Chen, Chief Executive Officer, of Yushan Energy Co. Ltd. indicated “Yushan Energy Co. Ltd. is very happy to be working with Green Giraffe and Cathay United Bank to develop the financing strategy for the Hai Long 2 and Hai Long 3 projects in Taiwan. Each of Green Giraffe and Cathay United Bank are leaders in their fields, with impressive experience, strong professionals and a track record of success. Together with our partner Northland Power Inc., we look forward to working with Green Giraffe and Cathay United Bank to bring the Hai Long 2 and Hai Long 3 projects long-term success in Taiwan.”
Photo credit
Presentation
Tokyo: Lessons learnt from the European offshore sector
3rd Asia Offshore Wind Day
25 January 2018
Sophie Cherrier presented the lessons learnt from the European offshore wind sector to the audience at the 3rd Asia Offshore Wind Day, Toranomon Hills Forum, Tokyo. The presentation looked at the industry-wide lessons from Europe, the bankability of offshore wind projects, key financing lessons learnt and the challenges and opportunities facing the Japanese offshore wind sector.
News
Nordsee One offshore wind farm achieves final project completion
Press release
21 December 2017
Green Giraffe successfully advised the Nordsee One project to improve financing conditions of its non-recourse financing initially raised back in March 2015.
TORONTO, ON–(Marketwired – December 21, 2017) – Northland Power Inc. (TSX: NPI) announced today that the 332 MW Nordsee One offshore wind farm achieved final completion on 20 December 2017. The project was completed on schedule and under its total budget of EUR 1.2 billion.
All 54 turbines have been sending power to the grid since September 2017. Final completion marks the official end of construction and the start of the operational phase of the project, and also signifies that the terms required to satisfy the project lenders for term conversion have been achieved.
Concurrent with achieving final completion, Nordsee One has also successfully and favourably restructured the project’s EUR 840 M senior debt.
Green Giraffe acted as exclusive financial advisor to support the sponsors of Nordsee One, Northland Power and Innogy.
Full press release from NPI’s website
Blog post
Carbon pricing and the impact on renewable energy finance
Energy Blog
20 December 2017
Damiano Ting disusses the impact of carbon pricing on the economics and financing of renewable energy.
Article
Neoen raises global portfolio mezzanine debt
Press release
18 December 2017
Green Giraffe raised EUR 245 M mezzanine debt in 3 currencies on a 1.6 GW worldwide portfolio of onshore wind and solar assets in development, construction and operation.
Green Giraffe advised Neoen, a leading French renewable energy producer, on raising a mezzanine debt financing for a 1.6 GW global portfolio of renewable onshore wind and solar projects. The portfolio consisted of 42 projects in France, Australia and emerging markets. The projects are either in final development stage, under construction or in operation. The mezzanine financing was closed in 3 cross-collateralized currency tranches (EUR, USD and AUD), with an aggregate equivalent commitment of EUR 245 M.
The financing closed on 14 December 2017 and was validated as a “green bond” following environmental, social and governance due diligence by Vigeo Eiris, a recognised independent expert. The bond has an attractive 20-year tenor and is provided at a holding company level dedicated to this financing, with no recourse to the parent company. It is then structurally subordinated to existing senior loans at the individual project level. The bondholders are AMP Capital, an international investment manager headquartered in Sydney, Australia.
The financing provides financial resources for Neoen’s diversified pipeline of projects around the world, without diluting Neoen’s share ownership in its plants, and adds high-quality renewable energy assets to AMP Capital’s infrastructure debt portfolio.
Charlie Canevet, Corporate Finance Director of Neoen: “The signing of this 245 million euro junior green bond is yet another achievement for Neoen and Green Giraffe. This is a unique project, with a large portfolio of assets and multiple currencies and geographies. Green Giraffe’s efficient and professional work throughout the process was key to closing such a complex transaction with highly attractive terms, notably the 20-year tenor.”
Emma Haight-Cheng, AMP Capital Infrastructure Debt Partner: “The portfolio we are funding represents a unique business, by virtue of its scale, geographic and technological diversification as well as the expertise within Neoen underlying its development. France and Australia account for more than 80 per cent of the portfolio, representing robust, stable energy markets with transparent regulatory regimes and a history of support for renewable energy. We view the investment as offering robust and highly attractive risk-adjusted returns. We were delighted by the experience of working with Green Giraffe as Financial Advisor on this complex transaction, and we would like to sincerely thank them for their efforts to assist the transaction reaching financial close.”
Neoen was also advised by De Pardieu Brocas Maffei (legal). AMP Capital was advised by Everoze (technical) and Watson Farley Williams (legal).
Project page: https://green-giraffe.com/projects/neptune-2#detail
Blog post
The Green Giraffe – Deutsche Bucht story
Energy Blog
1 December 2017
With the closing of the Deutsche Bucht (DeBu) financing (and sale of the project to Northland Power), a major page in Green Giraffe’s history has turned and it is worth telling the tale in full.
We were first approached by Highland, the family office of Lord Irvine Laidlaw of Rothiemay, in September 2011, on the recommendation of CMS, a Hamburg law firm. At that time, Green Giraffe was a very young company, not two years old. We had just helped close our second major transaction with the financing of the Meerwind offshore wind farm in Germany, advising Blackstone (following the closing the previous year of the C-Power offshore wind farm in Belgium). At the time, offshore wind transactions were quite rare and these deals put us on the map, at least for offshore wind advisory.
News
Top 100 Power People in Wind 2017 (A Word About Wind)
A WORD ABOUT WIND
14 November 2017
For the sixth consecutive year Jérôme Guillet, Green Giraffe Managing Director, was recognized as one of the “Top 100 Power People” by specialized publication A Word About Wind, with rank #27.
“Jérôme Guillet is a highly respected name in wind energy finance, with a team that has worked on notable offshore fundraisings including EUR 2.8 bn for the 600 MW Gemini and EUR 1.9 bn for the 402 MW Veja Mate. Both were commissioned this year. Under his leadership, Green Giraffe has this year worked with Elicio, Eneco and Diamond Generating Europe to raise EUR 1.2 bn for the 370 MW Norther; on a EUR 591 M debt financing for Trianel Windpark Borkum II; and helped Northland Power to reach a EUR 1.3 bn financial close for its newly-acquired 252 MW Deutsche Bucht. The firm has also worked in large onshore projects, including the 309 MW Hornsdale in Australia.”
Click here for the full report (behind pay wall).
Jérôme Guillet co-founded Green Giraffe in 2010 and was a Managing Director until 2021.
Presentation
Financing floating offshore wind projects
Floating Offshore Wind UK
14 November 2017
Martin Guzzetti presented the evolution and outlook of the debt and equity markets for floating offshore wind at the first Floating Offshore Wind UK (FOW UK) conference on 14 November in Glasgow. The presentation zooms in on the requirements, enablers and possible terms of financing floating offshore wind projects.
News
Offshore wind in a zero bid climate – PFI article
EMEA REPORT
17 October 2017
In an article published in Project Finance International’s EMEA Report last month, Jérôme Guillet discusses the prospects for project finance for offshore wind projects in the context of recent auctions.
A PDF of the article can be downloaded on this site, while the orginal article can be found on PFI’s website here (behind a paywall).
The conclusions remain upbeat
“In any case, we still expect plenty of activity for lenders in offshore wind in the coming years, as there is still a large backlog of projects with solid tariff structures to be financed, including for instance Neart na Gaoithe in the UK (450 MW), most of the projects under the first two rounds of French tenders – 2,500 MW between the EDF/ Enbridge and the Engie/EDPR projects which are all expected to be project financed – and some of the projects under the UK CfD round. At least Triton Knoll and Moray Firth are likely to use project finance.”
“Meanwhile, merchant risk will start to be borne by lenders to a limited but steadily increasing extent on various renewable energy transactions – refinancings of old assets, winners of onshore or solar tenders at low prices – and this creates a body of precedents that will be useful when the first “real” merchant projects need to be financed in offshore wind, if that actually happens.”
“Ultimately, as the volume of investment required is large, and project finance debt is cheaper than the alternative sources of funding, investors and lenders will make it work in a way that is useful for the industry and safe for lenders.”
Jérôme Guillet co-founded Green Giraffe in 2010 and was a Managing Director until 2021.
News
Wieringermeer wind farm sale
Press release
29 September 2017
Green Giraffe advised on the sale of the Wieringermeer wind farm (115 MW) from Windcollectief Wieringermeer to Vattenfall.
Vattenfall/Nuon take over Windcollectief Wieringermeer wind turbine positions and decided to invest 200 million euros to build first fifty turbines
Amsterdam, 29 September 2017. Vattenfall, the parent company of energy company Nuon, is taking over the 32 turbine positions from the members of the Windcollectief Wieringermeer. This means that Nuon will own a total of 82 wind turbines at the future Wieringermeer wind farm, which will become the largest wind farm on the Dutch mainland.
Nuon already owns 50 turbines but with this acquisition, it will considerably increase its share in this wind farm. Work began on this wind farm 10 years ago in a joint venture between ECN, Nuon and partners, and Windcollectief Wieringermeer. ECN will retain ownership of the remaining 17 wind turbines in the wind farm. One wind turbine, the Polder turbine, will be made available for local residents. In the near future, the new wind farm Windpark Wieringermeer will have 100 wind turbines. Together, they will produce approximately 1.3 billion kWh of renewable electricity, comparable to the consumption of approximately 370,000 households.
200 million euros In addition to the acquisition of 32 wind turbine positions, Nuon has taken the investment decision for the first construction phase of Windpark Wieringermeer. This involves an investment of approximately.
Blog post
Floating offshore wind (part 2): Financing FOW
Energy Blog
21 September 2017
In a second post on floating offshore wind, Martin Guzzetti addresses the financeability of the sector.
Presentation
Offshore wind finance – evolution and outlook
Project Finance and M&A forum
11 September 2017
Barbara Zuiderwijk presented the evolution and outlook of the debt and equity market for offshore wind at the second Project Finance and M&A (PFMA) forum for renewable energy on 11 September in Berlin. The presentation zooms in on the consequences of recent offshore wind tender results.
News
The wind has changed – current appetite for investment in offshore wind
OFFSHORE WIND INDUSTRY
8 September 2017
Udo Schneider, head of our Hamburg office, gave his view on the current appetite for investment in offshore wind projects and expected developments in an interview with the Offshore Wind Industry magazine.
How has the appetite for investment in offshore wind developed in recent years and what are you forecasting for the future?
“Most offshore wind parks have performed well to date. Considering such reliable performance in combination with substantial liquidity in capital markets there is great interest in financing offshore wind assets. Certain investors cannot – yet – take construction risks and will only invest following construction completion. The competition amongst investors is more intense for projects with higher feedin tariffs. This competition also leads to a reduction in required equity returns – which helps to reduce the levelized cost of electricity.”
Read the full article here
Blog post
Floating offshore wind (part 1): Coming of age
Energy Blog
7 September 2017
Martin Guzzetti discusses the strategic rationale behind floating offshore wind, exploring the similarities and differences with fixed-bottom offshore wind projects.
News
Deutsche Bucht reaches financial close
Press release
18 August 2017
Green Giraffe advised on the EUR 988 M debt raise for the 252 MW Deutsche Bucht offshore wind farm, located 95 km North West of the island of Borkum in the German North Sea.
The Deutsche Bucht (DeBu) offshore wind farm has reached financial close. The project, located approximately 95 km North West of the island of Borkum in the North Sea, is scheduled to be completed by the end of 2019. It will have a capacity of 252 MW and comprises 31 MHI-Vestas V164 wind turbines. Green Giraffe was the sole financial advisor to DeBu, which was initially owned by Highland Group Holdings and is now 100% owned by Northland Power Inc.
Green Giraffe was first mandated by Highland on DeBu in 2012 and has worked on the project since, including advising on the successful bidding for additional capacity. Over the last two years Green Giraffe has been focussed on managing the commercial aspects of the project, overseeing the negotiation and signing of the main project contracts for turbine supply, balance of plant, and operations and maintenance, advising on the sale of the project to Northland Power Inc, whilst arranging in parallel a non-recourse debt financing in an amount of EUR 988 million provided by 10 commercial banks. Both the equity and debt transactions closed in August 2017 and construction has now started.
Project highlights:
252 + 17 MW offshore wind farm, with completion scheduled for 2019
EUR 1.3 billion
Will produce over 1 TWh of electricity per annum
The original 210 MW site is complemented by an additional 42 MW won in an auction organised by BnetzA in 2015
In addition, the project is investigating the development of two additional demonstration turbines utilizing suction bucket foundations. If built they will contribute an additional 17 MW of capacity.
Deal highlights:
100% sale from Highland Group Holdings to Northland Power Inc.
Equity transaction closed on 17 August 2017
Project financed transaction with only commercial lenders
Debt transaction closed on 18 August 2017
First financing of an MHI-Vestas turbine in Germany
Blog post
The Tesla Model 3 and why we ordered a few
Energy Blog
3 August 2017
Jérôme Guillet explains how Green Giraffe are on the road to carbon-positive.
Article
Valeco and Mirova sign the financing of 75 MW onshore wind under the new French CfD scheme
Press release
27 July 2017
On Thursday 27 July 2017 Valeco and Mirova signed the financing of the second of three batches of projects foreseen within the 180 MW Masai financing framework (signed in November 2016 with CEPAC, Auxifip and Crédit Agricole Languedoc agency). This batch is composed of three wind farms located in France for a cumulative capacity of 75 MW and a debt envelope of EUR 91 M of long term loan and EUR 13 M of VAT loan.
This is one of the very first financings of a renewable energy plant under the recently passed contract-for-difference legislation in France. A private PPA was signed for each SPV, which was validated by the lenders, and the financial structure had to be adjusted to take account of the new risk structure involved by this regulation, notably an assessment of the number of hours where electricity price are expected to be negative.
In addition to Green Giraffe, DLA Piper (legal) and Noveo Finance (hedge) advised the borrowers while Linklaters (legal), Everoze (technical), Deloitte (model audit, tax & accounting), Gras Savoye (insurance) and IHS (electricity price) advised the lenders.
Blog post
Zero bid auction proves the need for a new support system
Energy Blog
11 July 2017
Jérôme Guillet explains why fixed energy prices are necessary for the renewable energy industry.
As the renewable energy sector and its regulators grapple with the prospect of so-called “zero-subsidy” bids, as seen in the recent German offshore wind auction, here’s a suggestion to ensure that the renewable energy sector does not do anything counterproductive or even destructive in any of the upcoming tenders.
Blog post
Why Hinkley Point is unlikely to get built
Energy Blog
4 July 2017
Jérôme Guillet looks at the reasons why Hinkley Point C nuclear power station is unlikely to ever get built.
The Hinkley Point nuclear project in the UK is a long running saga, and it currently looks like it’s finally going to happen, after decisions by both the UK government and the board of EDF to go ahead with the project. Some early works have started (behind paywall) and full construction is now scheduled to go ahead in 2020 with operations starting in 2025. But new developments in the offshore wind markets, plus some of the complications associated with Brexit, are increasingly likely to both derail it and offer a way out.
News
Financing offshore wind is about finding the right structure
RENEWABLES NOW
26 June 2017
Financing of offshore wind projects is all about understanding the risks, doing your homework on the numbers and finding the optimal finance structure, Jérôme Guillet from financial advisory firm Green Giraffe tells Renewables Now in an exclusive interview.
Jérôme Guillet, Managing Director at Green Giraffe, was topic leader for finance at the recent Offshore Wind Energy 2017 event in London.
Blog post
The Green Giraffe Energy Blog
Energy Blog
12 June 2017
Jérôme Guillet, Managing Director of Green Giraffe, introduces the new Green Giraffe Energy Blog.
News
Infographic: 7 years of success for Green Giraffe
Press release
23 May 2017
Green Giraffe celebrated its 7-year anniversary in May 2017. In this short period we have grown quite fast, opened new offices and closed many deals, to the obvious satisfaction of our clients – as we regularly get re-hired for new missions!
This infographic gives a nice overview of the key achievements of 7 years of Green Giraffe.
Presentation
Trianel Windpark Borkum II overview of project and financing process
13th WAB Offshore Conference
10 May 2017
Udo Schneider presented an overview of the Trianel Windpark Borkum II project and financing process from his point of view as project manager on this deal during a panel at the 13th WAB Offshore Conference on 10 May in Bremerhaven, Germany
News
Gemini achieves full project completion and closes refinancing
Press release
28 April 2017
Green Giraffe advised on the EUR 2 bn refinancing for the 600 MW Gemini offshore wind farm, which closed concurrently with full project completion.
TORONTO, ON–(Marketwired – April 28, 2017) – Northland Power Inc. (“Northland” or “the Company“) confirmed today that the 600 MW Gemini offshore wind farm achieved full completion on April 28, 2017. The project was completed ahead of schedule and under its total budget of EUR2.8 billion.
All 150 turbines have been operating since October 2016 and, to date, have generated over EUR250 million of net pre-completion revenues. Full completion marks the official end of construction and signifies that all of the terms required to satisfy the project lenders for term conversion have been achieved.
Concurrent with achieving full completion and term conversion of the loan, Gemini has also successfully and favourably restructured the project’s EUR2 billion senior debt. This restructuring will reduce loan margins, remove the original cash sweep requirements in year 5 under the previous mini-perm financing, and significantly improve distributions to Gemini’s owners.
As a result of these significant milestones, the project will soon make its first cash distribution to its owners; Northland expects to receive a one-time distribution of approximately EUR31 million comprised of its share of excess net pre-completion revenues and unused construction contingency. Regular distributions from Gemini are expected to commence in December of this year and semi-annually thereafter.
“Today’s announcement is a remarkable achievement and the result of exceptional collaboration between all involved,” said John Brace, CEO of Northland. “I would like to commend the Gemini project team; Siemens, who supplied, erected and commissioned the turbines; Van Oord, who designed, procured and installed all other aspects of the project; and everyone engaged with the debt restructuring for their significant efforts. The successful completion of our first offshore wind farm — ahead of schedule and under budget — combined with the loan restructuring, reflects Northland’s proficiency in delivering high-quality sustainable energy infrastructure that provides attractive shareholder returns.”
The offshore wind farm is owned by Northland Power (60%), Siemens Financial Services (20%), Van Oord Dredging and Marine Contractors BV (10%) and N.V. HVC (10%). Gemini is expected to generate enough clean and renewable energy to meet the needs of 1.5 million people in the Netherlands, and reduce the country’s CO2 emissions by 1.25 million tons per year. Located 85 kilometers from the coast of Groningen, Gemini is one of the largest offshore wind farms in the world.
ABOUT NORTHLAND
Northland is an independent power producer founded in 1987, and publicly traded since 1997. Northland develops, builds, owns and operates facilities that produce ‘clean’ (natural gas) and ‘green’ (wind, solar, and hydro) energy, providing sustainable long-term value to shareholders, stakeholders, and host communities.
The Company owns or has a net economic interest in 1,394 MW of operating generating capacity and 932 MW (642 MW net to Northland) of generating capacity under construction, including a 60% equity stake in Gemini, a 600 MW offshore wind project, and an 85% equity stake in Nordsee One, a 332 MW offshore wind project, both located in the North Sea. The Company also recently announced the acquisition of a 100% equity stake in a 252 MW offshore wind project DeBu currently in advanced development in the North Sea.
Presentation
Floating offshore wind – bankability & risk analysis
Floating Wind Seminar
25 April 2017
Green Giraffe, Norton Rose and Sgurr Energy organized a seminar on 19 April about floating offshore wind, where the status and commercialization prospects of this nascent sector were debated in front of a large audience including bankers, investors, contractors and industry advisors.
Clément Weber and Martin Guzzetti introduced the successful collaboration between Green Giraffe and Principle Power, focused on risk analysis of the WindFloat technology. They explained the risks involved in the development and construction of a hypothetical floating wind farm using the WindFloat technology and how these could be mitigated for investors and lenders.
The case study included contractual and technical mitigation solutions capable of optimizing the total project risk exposure, and it can serve as a functional model to assess the the the bankability of current and future floating offshore wind farms.
The conclusions drawn from the case study include the following:
Risk control starts with the design process considering the floating wind turbine unit as an integrated structure; collaboration with the turbine supplier is therefore central to defining the requirements and confirming acceptability of the floater’s performance;
The contractual structuring of a floating offshore wind project can be built on the fixed-bottom offshore wind experience with adjustments specific to floating technology; it also needs to be adapted to the (comparatively weaker) corporate strength of the technology providers;
The contractual arrangements with the turbine supplier should take into account the performance of the turbine when operating outside its design parameters due to the floater and the impact on energy production, be it detrimental or beneficial to the power curve;
Finally, floating offshore wind can raise financing if it targets the right financiers and meets their requirements, such as going through an extensive due diligence process focused on technology transparency, availability of operational track record, and the experience of the supply chain and development team.
About Principle Power
Principle Power is an innovative technology and services provider for the offshore deep-water wind energy market. PPI’s proven technology, the WindFloat – a floating wind turbine foundation – enables a change in paradigm for the industry in terms of reduced costs and risks for the installation and operations of offshore wind turbines. Principle Power sells the WindFloat as a technology solution and acts as service provider to developers, utilities and independent power producers, being present from the overall system design throughout fabrication, installation and commissioning, and providing support to customers during the operation life cycle of the platform. Principle Power’s mission is to make the WindFloat the most competitive, safe, reliable and environmentally friendly technology for deep-water offshore wind projects while enabling global offshore wind markets to reach their full potential.
Article
Comparative Analysis of International Offshore Wind Energy Development
IEA-RETD
29 March 2017
Green Giraffe was invited contribute to a report by the International Energy Agency’s Renewable Energy Technology Deployment programme (IEA-RETD) highlighting the importance of effective policy in stimulating deployment and driving cost reduction in the offshore wind sector.
A new report published today by the International Energy Agency’s Renewable Energy Technology Deployment programme (IEA-RETD) highlights the importance of effective policy in stimulating deployment and driving cost reduction in the offshore wind sector. Following a year of record breaking auction prices in the Netherlands and Denmark, the study identifies the key success factors that have supported a burgeoning industry in Europe, drawing lessons learned for both policy makers and industry players. Green Giraffe was invited to contribute to the report, to draw on our unique experience in the sector. We contributed to the content by providing underlying data and comments.
The report, which is delivered through a collaboration between the Carbon Trust, Mott MacDonald, and Green Giraffe, projects that global offshore wind capacity is set to increase threefold in the period from 2015 to 2020, marking a period of industry maturation as costs fall and new offshore wind markets emerge, both within and beyond Europe. Cost reduction of 60% from 2010 to 2017 indicates that industry targets for 2025 have been exceeded 8 years ahead of schedule, suggesting that offshore wind could potentially be fully integrated into the market on a competitive basis in some European countries within the next decade. However, the report suggests that a more cautionary approach is expected in new markets with less established industry structures, such as the United States and East Asia.
Analysis of the evolution of regulatory frameworks identifies several examples of best practice, underpinned by the need for political stability and visibility of market scale and support mechanisms. Notable recent policy trends include the introduction of competitive auctions and centralised development models, in which government bodies take on a greater role in the development process.
These trends are seen to be having a considerable impact on the risk profile for developers, with increased allocation and price risk countered by reduced development and technical risk. In combination, this is resulting in lower perceived risks from the finance community due to growing confidence in the ability of developers and the supply chain, with offshore wind increasingly considered an attractive investment opportunity for a more diverse range of actors.
“This report is a must-read for policy makers and industry stakeholders in established and emerging markets to understand the key factors of successful offshore wind deployment. The numerous case studies and detailed recommendations give valuable insights that show the state-of-the-art of this promising renewable energy sector.”
David de Jager, Operating Agent for the IEA-RETD
“The offshore wind industry is a major success story, as demonstrated by the steep cost reduction achieved in recent years. The progress made has been underpinned by supportive policy frameworks, but continued support is necessary to drive long-term cost reduction and open new markets for offshore wind on a global scale. This report highlights a number of lessons learned that can serve as best practice for policymakers.”
Rhodri James, Manager at the Carbon Trust
“Offshore wind is moving to the next stage of its evolution as evidenced by the results of recent auctions. The significant cost reductions observed will further bolster its standing as a key contributor to the European energy mix, while also enabling it to become truly global. This report is invaluable in highlighting the current state of play and key lessons learned to further support policy making.”
Christos Kolliatsas, Divisional Director for Hydro and Renewables at Mott MacDonald
“With its current track record and demonstrably lower production costs, offshore wind has a bright future, in Europe and elsewhere. Like all infrastructure activity, it combines high upfront investments with low operating costs, and requires a solid regulatory framework to ensure that early development can be fostered and that industrial maturity can be reached quickly. This report shows what has been done in the past and what worked. As such, it is a precious policy tool and thus a document that will directly help the industry.”
Jérôme Guillet, Managing Director at Green Giraffe
Recommendations for policymakers and industry players include:
Governments should re-evaluate their offshore wind ambitions in light of accelerated cost reduction
Governments should consider implementing near-term roadmaps to hedge against long-term uncertainty
Competitive auctions can drive down costs, but should be accompanied by government de-risking activities
Governments and industry players should continue investing in technology innovation to achieve long-term cost reduction
Industry players should embrace collaboration to share the cost and risk of delivering large-scale projects and undertaking R&D activities
Industry players should engage more with the public to highlight successes and improve the public perception of the offshore wind industry
Click here for the full report
Jérôme Guillet co-founded Green Giraffe in 2010 and was a Managing Director until 2021.
Presentation
Introduction to wind project finance (IEEFA Conference
IEEFA Conference
15 March 2017
Jérôme Guillet was invited to provide training on the economics of wind energy and how projects are financed, and also joined a panel discussing how lenders and investors see the sector.
The Institute for Energy Economics and Financial Analysis and Columbia Law School brought together environmental advocates and attorneys from around the world for a three-day training program in New York City. The conference covered current developments in the coal, natural gas, renewable energy, and electric utility industries. It is designed to provide advocates and attorneys with the skills to understand and engage in the financial aspects of current debates on fossil fuels.
Jérôme Guillet co-founded Green Giraffe in 2010 and was a Managing Director until 2021.
News
Top 100 Women’s Power List
A WORD ABOUT WIND
7 March 2017
Barbara Zuiderwijk and Sophie Cherrier were recognised for their leading roles in the industry in the inaugural “Top 100 Women’s Power List 2017”, published by specialised publication A Word about Wind.
Ranking #42 and #58 respectively, their inclusion in the list is an acknowledgement of their influential work and illustrates how well-respected they are across the industry.
Sophie Cherrier #58
“Cherrier was the youngest and most junior member at the renewable finance specialist Green Giraffe when it launched in 2010, but has become one of the most effective members of its team. Her highlights so far include her work on the 600 MW Gemini offshore windfarm, where she started on a team of five and ended up as chief negotiator with its 17-strong banking group, and now is working on the refinancing of the project. She has also worked on the 332 MW Nordsee One, 325 MW C-Power and 252 MW Deutsche Bucht”
Barbara Zuiderwijk #42
“Zuiderwijk is one of the co-founders of renewable energy financial advisor Green Giraffe, and has worked on a host of major offshore projects including the 600 MW Gemini, 400 MW Veja Mate, 216 MW Northwind and 165 MW Belwind. In 2016 she advised on the EUR 900 M debt raise for the planned 370 MW Norther project in the Belgian North Sea, and is now working on the redevelopment of the 112 MW Wieringermeer project in the Netherlands. She joined Green Giraffe from Evelop Capital, and has also worked at ABN Amro.”
News
Q&A interview Sophie Cherrier Top 100 Women’s Power List
A WORD ABOUT WIND
7 March 2017
Richard Heap spoke to Sophie Cherrier, director at Green Giraffe, about the large offshore deals she has led including the 600 MW Gemini, working overseas, and support for women in wind.
Where were you before Green Giraffe?
I worked for two years in Dexia’s project finance department, which is where I met several of the other founders of Green Giraffe and was invited to participate in the creation of the company in 2010. We started with five people in Paris and five in the Netherlands, and were quickly mandated on our first project: the 325 MW C-Power offshore wind farm in Belgium.
Did you work on that project?
I did, and after that I got involved in the 288 MW Meerwind project in Germany. I was closely involved on the debt process up to financial close, and also actively followed the construction period, to completion. In parallel, I worked for the EDF / Dong consortium on the first French offshore wind tender. Then, right after bid submission – which our client eventually won – I started working on the 600 MW Gemini in the Netherlands.
When I started working on Gemini in early 2012, the project was facing a lot of challenges, given its size and lack of liquidity in the market then.
You have worked on Gemini since the beginning. Has it been interesting to see that project evolve?
Definitely. When I started working on Gemini in early 2012 the project was facing a lot of challenges, given its size and the lack of liquidity in the market then. It needed huge and unprecedented volumes of debt and equity to reach financial close. We had five people embedded in the project team for three years, working on contractor selection and subsequent commercial negotiations, as well as raising equity and structuring the debt.
I have great memories of that project and I enjoyed working with sponsors, including Northland Power, and valued their high level of trust and support. In particular, I remember us leading negotiations with lenders including around 70 people in the room, all with a common goal to make this project happen but different perspectives not to mention cultural differences.
We closed the financing in 2014, with more than €2bn of senior debt raised and I’m now working on the refinancing.
Is lender appetite different now?
In order to be able to reach financial close, we had to work around all of the offers received from commercial lenders, as well as involve multilateral institutions, because we needed all of them.
When we did Nordsee One and Veja Mate a year later, we could pick and choose arrangers amongst enough experienced banks fighting for the position. Liquidity has been strong ever since.
Do you expect the move towards auctions to change the way deals are structured?
Not so much on the debt side, no. The banking market has not done anything undisciplined to date in offshore wind, and I don’t expect this to change.
Banks will be asked to improve some terms – leverage, pricing, contingencies, equity retention, to name a few – as part of the efforts made by all stakeholders to bring prices down, and as a result of having a longer track record, but not to overturn ten years of successful precedents. And lower tariffs may mean lower amounts of debt, and less leverage, so structures would not be much more aggressive.
“The key thing we can do to encourage talented women is to show this is an exciting area with lots of opportunities.”
And what impact will this have?
The interesting question is the impact of lower prices on regulatory frameworks. It will be important to explain that regulations providing long-term fixed-price regimes are still necessary when offshore wind looks “market competitive” – and this is linked precisely to the need to attract cheap long-term financing for what is still a capital-intensive industry, and cheap finance does not go with merchant risk!
It’s also interesting to observe that the market is getting a lot more concentrated: we could be moving towards a de facto oligopoly with high barriers to entry as parties other than the small group of existing very experienced players give up, and prices might nudge back up as a result of margins being captured by a smaller group of players.
Haven’t you also been working in the Americas?
I started looking at Latin America over a year ago, as I realised Green Giraffe could bring a lot of value there. We got involved in the first renewable energy tender in Mexico, where we supported a French developer and they won support for one of their projects last year.
Clearly, Green Giraffe is supporting the Women’s Power List and has been supportive of you in your career. Is it the same for all employees?
I would say that Green Giraffe does not particularly promote women – other than it tries hard to hire them! – but it gives an equal chance to everyone, which is what I appreciate the most. The organisation is
very flat and we have a lot of opportunity to expand our expertise, independently of our gender.
Personally, I think the way to encourage people and grow the company is to show them the path and empower them, which we do with our strong culture of knowledge-sharing.
There is a gender imbalance in parts of wind. Does it bother you?
Men and women are not yet on equal footing – the large numerical imbalance is a fact and most high-level positions are occupied by men. Having said that, it doesn’t bother me as long as we’re treated fairly and on an equal basis.
I’m actually happy to witness a new generation of women with lots of talent and I feel my role is rather to encourage them within my company or on projects. The key thing we can do beyond sharing knowledge is to show this is an exciting area with lots of opportunities and the sector is also essential for our economy and society.
What’s the next step for your career?
Hopefully going abroad. I spent a few months in Hong Kong with Veolia when I started working and I enjoyed it.
For me, the important part is to learn new things, meet a variety of people and experience new cultures. I enjoy Asia, but the work I did in Latin America also took me to Argentina, Brazil and Mexico. It’s difficult to say where but probably not in Europe, just to make it even more challenging.
Click here for the full report (behind paywall).
News
Hornsdale stage 3 (109 MW) closes financing
Press release
1 March 2017
Neoen, John Laing and Megawatt Capital secure Financial Close for the final stage of Hornsdale Wind Farm (SA), one of the most competitive renewable energy projects in Australia.
Leading French renewable energy firm, Neoen, leading international infrastructure investor, John Laing, and Neoen’s local partner Megawatt Capital, have today secured financial close for the 109 MW third and final stage of Hornsdale Wind Farm, which once fully commissioned will have a total capacity of 309 MW
Hornsdale Wind Farm stage 3 is setting a new benchmark in Australia by reaching financial close with a highly competitive non-inflating long term cost of energy, successfully securing all funding while covered by one of Australia’s most competitive renewable electricity supply contracts at a fixed 20-year rate of $73/MWh
All three stages of the Hornsdale wind farm have contracted their energy production through long term Feed-in-Tariffs with the ACT government, awarded through competitive wind and next-generation renewables auctions. In addition, all three stages will generate low-cost power into the South Australian electricity network which is a win-win for both ACT and South Australian electricity consumers
Franck Woitiez, Managing Director of Neoen Australia, commented that:
‘‘With the Hornsdale Wind Farm Stage 1 (100 MW) now complete, and construction well under way for Stages 2 (100 MW) and 3 (109 MW), Neoen is proud to be delivering a low-cost renewable energy future to the ACT and South Australia. Being a long-term shareholder and renewable energy producer allows Neoen to be at the forefront of technologies and decreasing costs of renewables, which is good for Australia. Neoen now has 455 MW of Wind and Solar generators in construction or operation in Australia, and our target for 2020 is to develop, build and operate at least 1GW of competitive, sustainable and clean energy assets.”
One of the main factors behind the low-cost project economics is the long-term focus of the parties involved.
KFW IPEX-Bank and Societe Generale have firmed-up for the third time a long-term structured finance package for the Hornsdale Wind Farm, reinforcing both groups relationship with Neoen in Australia and globally. Investec provided Junior Financing to the project, in line with its past commitments on Stage 1 and Stage 2.
Mark Schneider of Megawatt Capital Investments, said that:
“The ACT Government are clearly at the forefront of long-term sustainable energy policy in Australia. The Government’s vision and strategy in this area have secured the lowest cost renewable energy contracts in Australia and created a long-term sustainable industry innovation hub in the national capital. Neoen will own and operate the assets over their 20-plus year life through their established Australian operations hub. Leading technology suppler Siemens have agreed to provide long term maintenance on the equipment supplied, and our debt providers have agreed to provide competitive, long term financing for the project reflecting these long-term commitments. It’s a virtuous cycle, and one that has led to an outstanding result’’
Blair Townsend, John Laing, Managing Director of Primary Investments – Asia Pacific, said:
“Renewable energy remains an important growth sector for John Laing globally and we are very proud to again be partnering with Neoen to provide renewable energy to the ACT Government. The Hornsdale Wind Farm represents our fourth renewable energy investment in Australia and is another example of John Laing’s increasing commitment and standing in the Asia Pacific market. Along with its portfolio of wind and biomass renewable energy projects in the UK, Europe and the US, this demonstrates our strong expertise in the renewable energy sector across our geographies.”
Today’s announcement follows the news that Hornsdale, in co-operation with AEMO and ARENA, is undertaking an Australian-first trial of Frequency Control (FCAS) services from a wind farm. Under this trial, AEMO will direct Hornsdale to provide grid stabilising services to the National Electricity Market in reaction to rapid changes in supply/demand and other system conditions that have the potential to affect the stability of the South Australian network
Through the trial, the owners of Hornsdale wind farm together with ARENA and the market operator, AEMO, plan to explore untapped grid-stabilising potential within the advanced Siemens wind power technology
Hornsdale Wind Farm is being built by Siemens which is providing 99 Wind Turbines (SWT 3.2 MW), alongside with South Australian firms Catcon and CPP, allowing for the local econoo benefit from a global investment of more than $870m for the 3 stages of Hornsdale Wind Farm
News
TWB II to partner with ewz
Press release
21 February 2017
On 21 February 2017 Trianel Windpark Borkum II announced that ewz and Fontavis will jointly hold a stake of 24.51% in the 200 MW offshore wind farm.
On 21 February 2017 Trianel Windpark Borkum II announced that Elektrizitätswerk der Stadt Zürich (ewz), the municipal utility of Zurich, and its co-investor, the Swiss investment manager Fontavis, will jointly hold a stake of 24.51% in the 200 MW offshore wind farm. The remaining shares will be held by EWE (37.5%) and the Trianel pool partners (37.99%), a group of 18 municipal utilities.
Green Giraffe supported TWB II in its search for a new investor and is delighted to congratulate the project team on having found an excellent partner for the development and operation of the offshore wind farm.
Presentation
Project finance for German offshore wind
WINDFORCE Baltic Sea Conference
10 February 2017
Damiano Ting was invited to the WINDFORCE Baltic Sea Conference 2017 in Tallinn to present the current status of the German offshore wind market with a focus on financing conditions. This was highlighted with a case study on the German offshore wind project Veja Mate.
News
Green Giraffe is the official partner to A Word about Wind’s “Women’s Power List”
A WORD ABOUT WIND
17 January 2017
Green Giraffe is delighted to announce a partnership with respected industry publishers “A Word about Wind” for their forthcoming inaugural Women’s Power List report, which will be published on 7th March to tie in with International Women’s Day and will celebrate the achievements of our female colleagues in the industry.
Green Giraffe will also be the official sponsor for the launch event for the report in the City of London on the same day.
Green Giraffe’s many successes over the last year would not have been possible without the strong women (some of which have been present since the start of the company) taking leading roles on transactions and helping manage the company. We benefit from the talents of all our employees and we strongly believe they should all be given the same opportunities and rewards. Green Giraffe has focussed from its inception on recruiting talented women and supporting them through their careers and we are thus very pleased to be associated with A Word about Wind’s initiative.
News
Solarpark Scaldia announces sale
Press release
21 December 2016
On 21 December 2016 Solarpark Zeeland announced the sale of Solarpark Scaldia to ib vogt. Green Giraffe advised and supported the development of the project.
Solarpark Scaldia is a 50 MWp ground based solar park in the Vlissingen port area in the south-west of the Netherlands. The solar park lies in a 6 km long cable corridor around Sloe harbour area in Vlissingen and Borsele municipalities.
Earlier this year the land contracts with Zeeland Sea Ports and private land owners were signed and the building permits were obtained.
In December 2016 the project won a long term price contract under the SDE+ auction scheme. The SDE+ award guarantees the project a 15-year feed-in tariff for renewable energy production.
Green Giraffe was involved as financial advisor to Solarpark Scaldia and actively supported in project development and contract negotiations, including the bid for the SDE+ tariff. After the close of the 30 MWp Sunport Delfzijl project earlier this year, Green Giraffe is again involved in the realisation of the largest solar park in The Netherlands.
Article
Stevin welcomes Rentel to the grid (PF International)
PROJECT FINANCE INTERNATIONAL
20 December 2016
On 3 October 2016, the 309 MW Rentel offshore wind farm reached financial close. The deal represented the first offshore wind farm to close since the Stevin grid project was approved.
On 3 October 2016 Rentel offshore wind farm reached financial close. The deal represented the first Belgian offshore wind farm to reach financial close under the new support mechanism, and the first project that will use a new grid connection for offshore wind farms, bringing renewable electricity to the country via the Stevin onshore connection.
In this article Clément Weber, Director and Jérôme Guillet, Managing Director of Green Giraffe give their view on the first project to be financed since Stevin was approved.
News
Norther reaches financial close
Press release
15 December 2016
Green Giraffe advised on the EUR 900 M debt raise for the 370 MW Norther offshore wind farm, located 22 km off the coast of Vlaanderen in the Belgian North Sea.
Elicio, Eneco and Diamond Generating Europe (a subsidiary of Mitsubishi Corporation) are pleased to announce that they arranged the successful financing of the 370 MW Norther offshore wind farm, with a total project investment of EUR 1.2 billion.
The Norther offshore wind farm will operate 22 km off Vlaanderen and will be the largest offshore wind farm in the Belgian North Sea.
The offshore wind farm will consist of 44 turbines with a capacity of 8.4 MW and a total installed capacity of 370 MW. Norther will produce roughly 1.4 TWh per year, generating sustainable electricity for almost 400,000 households.
The project raised EUR 900 million (75% of the project budget) in non-recourse debt with a consortium of 10 financial institutions. Around half will be funded by the European Investment Bank, with Danish export credit agency EKF acting as guarantor for approximately half of that amount. The rest of the financing will come from a commercial lending club consisting of European banks ABN Amro, Belfius, BNP Paribas Fortis, Rabobank, and Société Générale, and Japanese banks BTMU, SMBC and SMTB. The debt has a maturity of 15 years post-construction.
As part of a two-contract construction strategy MHI-Vestas Offshore Wind will supply the turbines whilst offshore construction specialist Van Oord will be the balance of plant contractor. Norther is the first offshore wind project to obtain project financing for the MHI-Vestas V164-8.4 MW wind turbine, the largest commercial turbine today with its 80 m blades sweeping an area larger than the London Eye. The turbines will be connected to an offshore high-voltage substation which transform the electricity to 220 kilovolts before it is transported to the upgraded Stevin substation in Zeebrugge via a sub-sea cable. The electricity produced will be marketed by ENGIE Electrabel and Eneco.
Norther will manage construction and operation of the wind farm from an operations base in the port of Ostend.
Norther was advised by Loyens & Loeff (legal advisor), Green Giraffe (financial advisor), Chatham (hedging) and Aon (insurance). The lenders were advised by Benatar & Co (insurance), Mazars (model audit), Mott MacDonald (technical), Jones Day (legal) and KPMG (tax & accounting). Additionally, EKF was advised by Kromann Reumert (legal) and EIB was advised by Clifford Chance (legal).
About Elicio
Nethys SA is a shareholder via its daughter company Elicio NV, a Belgian renewable energy producer operating internationally. Nethys SA is owned by local municipalities of the Liege province (via Publifin, formerly named Tecteo Group) and is active in energy, telecommunication and the industrial development sector. Beyond Norther, the Nethys group is involved as shareholder (via Otary) in the Rentel, Seastar and Mermaid offshore wind projects in Belgium, and Elicio was actively involved in the development of Northwind.
About Eneco
Eneco is a major international producer and supplier of electricity, natural gas and heat, involved in developing and operating sustainable energy projects (including two operational offshore wind farms in the Netherlands – Princess Amalia and Luchterduinen). Furthermore, Eneco will market 50% of the electricity output of the windfarm via a separate power purchase agreement.
About Diamond Generating Europe
Diamond Generating Europe is wholly owned by Japan’s largest trading company, Mitsubishi Corporation. Mitsubishi Corporation is one of the world’s most diverse enterprises, with over 700 subsidiaries and affiliates worldwide. Diamond Generating Europe functions as a power producing business for MC in Europe, the Middle East and Africa, and recently acquired a 50% stake in the Luchterduinen offshore wind farm as part of a long term cooperation agreement with Eneco.
Presentation
Financing offshore wind – 2016 update
EnergyTalk
8 December 2016
Clément Weber was invited to speak at the Energy Talk conference on the evolution of offshore wind finance throughout 2016.
2016 was a busy year for offshore wind with a dozen greenfield projects and refinancings. In December, Clément Weber was invited to provide an update on offshore wind finance at the Energy Talk conference, explain the evolution of the equity and debt market and discuss the new challenges that have arisen.
News
Masen selects ACWA Power 170 MW Noor PV 1 program
Press release
17 November 2016
On 15 November 2016, Masen (the Moroccan Agency for Sustainable Energy), supported by Green Giraffe and Attijari Finance Corp as joint financial advisors, signed a 20-year PPA with ACWA Power for the 170 MW Noor PV 1 program.
News
Valeco closes 180 MW financing
Press release
15 November 2016
Valeco, supported by Green Giraffe, has signed the financing of a 180 MW wind and solar PV portfolio in France. The total long term debt financing is approximately EUR 260 M.
News
Top 100 Power People in Wind 2016 (A Word about Wind)
A WORD ABOUT WIND
8 November 2016
Jérôme Guillet, Green Giraffe Managing Director, was recognised for the fifth year running as one of the “Top 100 Power People” by specialized publication A Word About Wind, with rank #25
For the fifth consecutive year Jérôme Guillet, Green Giraffe Managing Director, was recognized as one of the “Top 100 Power People” by specialized publication A Word About Wind, with rank #25.
“Guillet is a hugely respected figure in wind energy finance, and his team has worked on a series of huge offshore fundraisings including €2.8bn for the 600MW Gemini, due to be commissioned in spring 2017, and €1.9bn for the 400 MW Veja Mate. In the last year, Green Giraffe has advised John Laing on the acquisition of 30% in the 111MW Nordergründe in the German North Sea; worked with WindMW on a €978m bond refinancing; and advised Velocita on a €200m project financing in France. It has also entered the Australian market.”
Click here for the full report (behind pay wall)
Jérôme Guillet co-founded Green Giraffe in 2010 and was a Managing Director until 2021.
News
Rentel reaches financial close
Press release
3 October 2016
Rentel has reached financial close for the construction of a new 309 MW offshore wind farm off the Belgian coast. The Rentel project – located 40 kilometers north of Ostend – will be the fifth offshore wind project in the Belgian North Sea.
News
John Laing acquires stake in Nordergründe
Press release
19 August 2016
John Laing Group plc, the international originator, active investor and manager of infrastructure projects, today announces that it has acquired a 30% stake in a 110.7MW offshore wind farm project in the German North Sea, just north of the city of Wilhelmshaven.
Green Giraffe was mandated by John Laing to advise in the acquisition of a 30% stake in the 110.7 MW nearshore project Nordergründe in the German North Sea
News
Green Giraffe on a new continent!
Press release
28 June 2016
We helped Neoen close the financing today for the 100 MW second stage of the Hornsdale wind farm in Australia.
Neoen Australia has secured a long-term debt financing package for the 32-turbine, 100 MW second stage of the Hornsdale wind farm which altogether with the first and third stages will comprise 105 Siemens turbines. The multi-staged project, majority owned and managed by Neoen, is located near the South Australian town of Jamestown, 200km north of Adelaide. John Laing holds a minority interest in the project.
Green Giraffe acted as financial advisor to the project in the run up to the closing.
Key features:
Neoen has developed the project with local partner Megawatt and majority owns it alongside John Laing
Siemens is building the wind farm, supplying the 32 turbines and providing long-term operations and maintenance of the project
Hornsdale wind farm stage 2 (like phase 1) is financed by international banks KFW IPEX-Bank GmbH and Societe Generale, with Investec providing a mezzanine loan
This phase is underpinned by a 20-year power purchase agreement with the ACT grid operator at 77 AUD/MWh
Article
Energy storage and PV the merit order effect
PV SOLAR ENERGY CONFERENCE MUNICH
20 June 2016
Frederico Sanches and Henri Gouzerh proposed a method to quantify the merit order effect of solar PV combined with centralised or decentralised storage in Germany, France, Italy, Austria and Switzerland (GFIAS) for the period 2007-2015.
They calculated the savings for power purchasers generated by the decrease in electricity spot market prices observed when solar PV plants feed electricity into the grid, first without storage and also by adding de-centralized storage capability to the PV capacity and shifting the use of centralized storage (e.g. pump-hydro storage) to benefit from the merit order effect.
This study has three main findings:
» Without storage, the overall savings over the past 10 years amounts to around EUR 31 bn for the whole GFIAS region and the average wholesale prices would have been 4 % higher had there not been any PV production;
» Combining PV with decentralized storage system does not currently contribute positively on the aggregate metrics, though in 2014 and 2015 small increases in the merit order effect were observed suggesting that some optimization may be possible;
» Where the centralized storage is used in conjunction with PV, the aggregate gain increases to EUR 33 bn (with a storage capacity of 25 GW).
Those findings clearly underline the social value of the power generated by solar PV in conjunction with storage. Frederico Sanches and Henri Gouzerh presented this article at the European Photovoltaic Solar Energy Conference and Exhibition in Munich in June 2016.
Presentation
How many offshore projects can be financed in a year?
WINDFORCE 2016
9 June 2016
Jérôme Guillet, Managing Director of Green Giraffe, was invited to discuss the appetite of the dept market for offshore wind at the WINDFORCE conference in Bremen.
Non recourse debt for offshore wind is booming, and debt strategies are diversifying with multiple possibilities in financing a project.
In June 2016, Green Giraffe Managing Director Jérôme Guillet spoke at the WINDFORCE conference in Bremen on the subject of how many offshore wind projects can be financed in a year.
Jérôme Guillet co-founded Green Giraffe in 2010 and was a Managing Director until 2021.
News
Top 100 Legal Power People in Wind (2016)
A WORD ABOUT WIND
7 June 2016
Mark Mathijssen, legal counsel at Green Giraffe, was recognized as one of the “top 100 legal power people in wind” by specialized publication A Word About Wind, with rank #33
“Mark Mathijssen is one of the founding partners of boutique renewables financial adviser Green Giraffe, which launched in 2010. With 18 years’ experience in corporate, financial and project contracting matters, of which a decade has been focused on renewables, he has played a vital role in some of Green Giraffe’s biggest deals. He has advised on major offshore projects including the 600 MW Gemini, 402 MW Veja Mate and 165 MW Belwind I, with a focus on negotiations with contractors, grid operators and turbine suppliers.”
News
New York State to participate in offshore wind lease auction
NYSERDA
2 June 2016
Green Giraffe contributed last year to the study conducted by the University of Delaware’s SIOW for the NYSERDA setting out key strategic steps New York State can take to reduce costs of offshore wind power over the next decade.
Green Giraffe contributed last year to the study conducted by the University of Delaware’s Special Initiative on Offshore Wind (SIOW) for the New York State Energy Research and Development Authority (NYSERDA) setting out key strategic steps New York State can take to reduce costs of offshore wind power over the next decade.
This week, the New York State Energy Research and Development Authority (NYSERDA) announced it will participate in the U.S. Department of Interior’s Bureau of Ocean Energy Management’s (BOEM) auction for a commercial offshore wind energy lease off the coast of Long Island.
Stephanie McClellan, director of SIOW, acknowledged the added value of Green Giraffe in the process which lead to this major milestone in offshore wind in the US.
“Green Giraffe was instrumental in helping the Special Initiative on Offshore Wind illustrate to New York State early on the benefits of the approach they are now undertaking. With their seasoned experience and expert knowledge we were together able to quantify the benefits and provide New York policymakers with a real roadmap to cost-effective offshore wind. We are so incredibly grateful for their collaboration on that project. This is a great step for US offshore wind.”
Article
Offshore wind breakfast briefing
Inspiratia
26 May 2016
Jérôme Guillet was invited to speak at an inspiratia-organised panel to discuss offshore wind finance in London on 26 May. The attached document is the summary prepared by inspiratia of the event. We highlight the following quote:
“Many in the market thought Veja Mate’s pricing was about as low as offshore wind could currently go, but even these terms are understood to have been undercut by Rentel in Belgium, which is expected to reach financial close before the summer.”
Jérôme Guillet, one of the founders of Green Giraffe, which advised on Veja Mate and is acting in a similar capacity on Rentel, said the pricing squeeze suggests there is still plenty of appetite from banks.
Jérôme Guillet co-founded Green Giraffe in 2010 and was a Managing Director until 2021.
Presentation
Financement des projets EnR
SER
24 May 2016
In May 2016, Henri Gouzerh gave an overview of project finance at a seminar held by Syndicat des énergies renouvelables (SER).
Presentation
Renewable energy in Africa
Alternative Africa
19 May 2016
Henri Gouzerh was invited to present an overview of the business case for renewable energy in Africa at the Alternative Africa seminar.
Renewable energy will undoubtedly play a significant role in the energy sector in Africa. In May 2016, Henri Gouzerh spoke about the business case for renewables in Africa at the Alternative Africa seminar in London.
News
EEco closes financing of energy efficiency portfolio
Press release
31 March 2016
Green Giraffe was mandated in October 2014 by a consortium of Solvay, Marubeni and Caisse des Dépôts in the non-recourse financing of a portfolio of energy efficiency projects located on Solvay industrial sites which closed in March 2016.
Solvay, Caisse des Dépôts and Marubeni invest in two new energy efficiency projects and create a holding to reinforce their partnership
Solvay, Caisse des Dépôts, and Marubeni Europe plc (“Marubeni”), have expanded their energy efficiency partnership with two new projects to finance and operate cogeneration plants at Solvay’s facilities in Tavaux (France) and in Spinetta (Italy). These projects join an established portfolio of similar projects to reduce energy consumption and the environmental impact of Solvay’s sites while enhancing the plants’ competitiveness.
The three partners have created a holding company EEco to speed up the development of these innovative energy efficiency projects and facilitate their management. Backed by a pioneering finance scheme, EEco Holding offers both the technological expertise and capacity to improve the energy and environmental management at limited investments for the customers.
EEco Holding groups four projects – Solvay’s plants in Tavaux and Spinetta projects plus projects announced earlier at Solvay’s plants in La Rochelle and Lyon (France) and which total a production capacity of 230 MW of electrical power and over 900 t/h of steam.
EEco Holding has settled a non-recourse project finance provided by MUFG’s banking arm, Bank of Tokyo-Mitsubishi UFJ and Sumitomo Mitsui Banking Corporation Group.
This innovative structure seeks to continue financing large-scale projects to assist industrial sites in reducing their energy consumption. Projects will be implemented on Solvay’s and third party plants.
Solvay Energy Services, Caisse des Dépôts and Marubeni reaffirm their commitment to fight climate change and to become key players in the energy transition.
Beyond co-financing the project, Solvay and Marubeni will bring their know-how in energy asset operations and maintenance. As for Caisse des Dépôts, this initiative shows that industrial energy efficiency projects can provide both a satisfying risk/return and significant environmental benefits.
Article
IEA case studies: Veja Mate, Gemini and Nordsee One
INTERNATIONAL ENERGY AGENCY
16 March 2016
The IEA-RETD brochure on the case studies of successful renewable energy financing has now been officially published. Green Giraffe has contributed the case studies of Veja Mate, Nordsee One and Gemini.
The IEA-RETD is one of a number of Implementing Agreements on renewable energy under the framework of the International Energy Agency (IEA). RETD stands for Renewable Energy Technology Deployment.
For the full brochure click here
Presentation
Financing floating offshore wind
FOWT conference
10 March 2016
Jérôme Guillet, Managing Director of Green Giraffe, spoke about financing floating offshore wind at the FOWT conference in Marseilles.
In March 2016, Green Giraffe Managing Director Jérôme Guillet spoke about financing floating offshore wind at the FOWT conference in Marseilles, describing potential debt and equity providers for this developing technology.
Jérôme Guillet co-founded Green Giraffe in 2010 and was a Managing Director until 2021.
Article
Velocita reaches financial close 47 MW
Press release
29 January 2016
The European renewable energy developer and operator, Velocita Energy Developments announced the £76m portfolio project financing of the Airies wind farm in Dumfries and Galloway, and the Sorbie wind farm in North Ayrshire.
Green Giraffe was mandated in 2015 by Velocita to assist in the debt raising process for the construction of a 47 MW onshore wind portfolio which closed on 28 January 2016
Financial Close reached for Scottish Wind Farms
Velocita Energy Developments secures non-recourse financing for two onshore Wind Farms in Dumfries & Galloway and North Ayrshire.
The European renewable energy developer and operator, Velocita Energy Developments (“Velocita”) announced today the £76m portfolio project financing of the Airies wind farm in Dumfries and Galloway, and the Sorbie wind farm in North Ayrshire. The financing arrangement with the Bank of Tokyo-Mitsubishi UFJ (“BTMU”) is Velocita’s second project in Scotland following the merger with 2020 Renewables in July 2012. The deal follows on from the successful €200m financing of the 120 MW Vaite-Bussiere, Rougemont-Baume 1 and Rougemont-Baume 2 wind farms closed in France in December 2015.
The 7.05 MW Sorbie project and the larger 39.9 MW Airies project are both due to be accredited under the outgoing Renewables Obligation (RO) regime. Construction began in January 2016 for Airies wind farm and will start in late February 2016 for Sorbie wind farm, both are expected to start operations in February 2017.
Airies & Sorbie have been developed by 2020 Renewables and will be built and operated by Velocita. I&H Brown has been contracted to undertake civil and electrical infrastructure works. General Electric will supply the 14 GE2.85-103 2.85 MW wind turbines with 80m hub height for the Airies Wind Farm as well as providing operations and maintenance services under a long term contract, meanwhile Enercon will supply the 3 E82-E4 2.35 MW turbines with 58.9m hub height and provide long term operations and maintenance services for the Sorbie wind farm. Electricity will be sold to ENGIE (formerly GDF SUEZ) under a long term Power Purchase Agreement.
Scotland is already providing over a third of the UK’s renewable electricity at a time where there is an increasingly tight gap between electricity supply and demand. Once operational, the project will make a valuable contribution to Scotland’s ambitious renewable energy targets, providing clean, green electricity.
Alan Baker – Chief Operating Officer of Velocita said “These are only two of four projects that we plan to secure project financing on during 2016 in advance of the proposed Renewables Obligation closure deadline”
Velocita has been advised by Brodies LLP, Wright Johnston & Mackenzie, Green Giraffe, and JC RA. Meanwhile, DNV GL, DLA Piper, Marsh, and BDO acted for BTMU.
Article
Sunport closes transaction
Press release
14 January 2016
Groningen Sea Ports, Sunport Energy and Wirsol announced on 14 January 2016 the sale of the Sunport Delfzijl solar park by Sunport Energy to Wirsol as well as the signature of the land use agreement between Groningen Sea Ports and Sunport Delfzijl for the construction and exploitation of the project.
These key contracts will enable the construction of a 30 MWp solar park, initially developed by Sunport Energy, on 30 hectares in the south-west corner of the Delfzijl harbour area of Groningen Sea Ports. It will be by far the largest solar park in The Netherlands.
Green Giraffe was involved as financial advisor to Sunport Delfzijl and actively supported in the final phase of project development and contract negotiations, including the bid for the SDE+ tariff.
Here are the full press releases in English and in Dutch.
Article
Predictions for renewable energy finance in 2016
Inspiratia
6 January 2016
Professional publication inspiratia has published predictions for renewable energy finance in 2016 by various experts in the field, including one from Green Giraffe Managing Director Jérôme Guillet.
“2016 will likely be the first time we see more than 10 offshore wind financings in one year. Some may not close until 2017 but the processes will certainly start next year.
There are projects in Belgium, Germany, the UK, plus the Dutch and Danish tenders – and we could also see the first projects in France coming to market.
There’s probably going to be a few refinancings, as well as several asset sales – some of which could include debt financing. Altogether, 2015 was amazingly active, but 2016 promises to be even better. There is a lot of liquidity in the market and that will continue, with more banks coming in, larger tickets available and institutional investors clearly attracted to the debt side as well. But since there are now many more projects chasing it, there’s going to be a new balance between liquidity and projects – and it’s not clear yet where the balance will end up. Banks can afford to be pickier.
Good projects will still find funding on attractive terms but it might be hard to go for the most aggressive structure unless you have a very compelling reason – and some transactions might be delayed if they misread the market. There will also be newcomers on the equity side – both financial and corporates. A lot of them have been looking at the sector but many haven’t closed transactions yet and should more easily find opportunities to do so today. 2016 stands a good chance to be the year when the first 8MW wind turbine is financed.
Finally, one of the open questions of the year will be around floating wind. Will there be commercial projects and will they successfully raise finance? My bet is that the process will at least get on its way in 2016. ”
See all other predictions on inspiratia’s website (subscribers only)
Jérôme Guillet co-founded Green Giraffe in 2010 and was a Managing Director until 2021.
Article
Meerwind issues EUR 978 M in bonds to refinance debt
Press release
17 December 2015
WindMW issues EUR 978 M in investment grade bonds to refinance the fully operational 288 MW Meerwind offshore wind project in the German North Sea.
Green Giraffe would like to congratulate its long standing client WindMW and its shareholder Blackstone for the successful placement of bonds worth EUR 978 M. The bonds were issued on 17 December 2015 to a group of around 20 international institutional investors and benefit from investment grade ratings from the three main rating agencies. Proceeds are mainly used to prepay around EUR 850 M of existing bank debt which was raised in August 2011 to finance the construction of the 288 MW Meerwind offshore wind farm.
Green Giraffe acted as financial advisor to WindMW in 2011 and helped raise EUR 869 M in long term construction facilities, the first transaction to use the KfW programme for offshore wind. After financial close, Green Giraffe assisted WindMW in liaising with and reporting to the lending group throughout construction which was formally completed in September 2015. As part of the bond refinancing process, Green Giraffe helped WindMW to benchmark the proposed bond option against a restructuring of the existing bank debt.
During the bond refinancing process, Green Giraffe advised WindMW on the interfaces with the existing bank group and helped to achieve a smooth refinancing process.
News
ROUVAI reaches financial close
Press release
16 December 2015
European renewable energy developer and operator Velocita announced the EUR 200 M project financing of the Vaite-Bussiere, Rougemont-Baume 1 and Rougemont-Baume 2 wind farms.
Financial close reached for French 120 MW wind farms
Velocita Energy Developments secures non-recourse financing for three Wind Farms in the Doubs region.
The European renewable energy developer and operator, Velocita Energy Developments (“Velocita”) announced today the €200m project financing of the Vaite-Bussiere (“VAI”), Rougemont-Baume 1 (“ROU1”) and Rougemont-Baume 2 (“ROU2”) wind farms (together the “ROUVAI” cluster) in the Doubs region, France. The financing arrangement with the Bank of Tokyo-Mitsubishi UFJ (“BTMU”) and ING Bank N.V. (“ING”) is Velocita’s second project in France . The deal follows on from the successful financing of the 31 MW Monts du Lomont wind farm in December 2014.
The project is a unique clustered development leading to three self-standing onshore wind farms to be built in two phases. Construction of the first phase – consisting of 35 turbines totalling 100 MW of capacity on VAI, ROU1 and ROU2 – will begin in January 2016 and the wind farms are expected to start operations end June 2017. Phase two will consist of another 8 turbines totaling 20 MW of capacity to be built on ROU2, bringing total installed capacity on ROUVAI to 120 MW by end June 2018.
ROUVAI has been developed in partnership with Opale Energies Naturelles and will be built and operated by Velocita. Artelia has been contracted by Velocita to undertake civil and electrical infrastructure works. General Electric will supply the 43 GE-220 HH110 2.78 MW wind turbines as well as providing operations and maintenance services under a long term contract. Electricity will be sold to EDF under a 15 year feed-in tariff.
The project cluster is about ten times the size of an average French onshore wind farm, and will make a valuable contribution to France’s ambitious renewable energy targets.
Green Giraffe, Allen & Overy, CGR Legal, Natural Power and JCRA acted for Velocita, Mott MacDonald, Linklaters, Marsh, and BDO acted for BTMU and ING.
Presentation
Mezzanine loans in offshore wind
Hogan Lovells offshore breakfast
15 December 2015
Clément Weber was invited to one of the regular breakfast events on offshore wind organised in Hamburg by Hogan Lovells to present Green Giraffe’s experience in raising mezzanine financing.
Subordinated loans can improve the return on equity for investors and contribute to the overall funding volume and have been used in offshore wind since the very first project to be financed with non-recourse debt (Q7 in the Netherlands). Recently, the universe of mezzanine providers looking at offshore wind has grown substantially, following the general rise in confidence from the finance world for the sector, and reinforced by the creation of new funds dedicated to mezzanine loans in the infrastructure sector.
Clément Weber, Director of Green Giraffe’s London office, was invited to one of the regular breakfast events on offshore wind organised in Hamburg by Hogan Lovells to present Green Giraffe’s experience in raising mezzanine financing, describe the current market and discuss the sustainability of such financing instruments.
News
Top 100 Power People in Wind (2015)
A WORD ABOUT WIND
10 November 2015
Jérôme Guillet, Green Giraffe Managing Director, was for the fourth year running recognized as one of the “top 100 power people” by specialized publication A Word About Wind, with rank #26.
“Guillet is one of the most respected individuals working in wind energy finance, and his team followed last year’s €2.8bn Gemini fundraising with another huge deal this year. In June, Green Giraffe concluded the €1.9bn financing of the 400MW Veja Mate, on behalf of Lord Irvine Laidlaw’s Highland Group Holdings. The deal with Siemens Financial Services, Copenhagen Infrastructure Partners and a consortium of banks was even more impressive given that it had to be completed in nine months for a client with no track record in building offshore wind farms.”
Jérôme Guillet co-founded Green Giraffe in 2010 and was a Managing Director until 2021.
News
Neoen secures EUR 40 M junior green bond with an 18-year tenor
Press release
9 November 2015
Leading French renewable energy producer Neoen, and M&G Investments and the Sequoia Economic Infrastructure Income Fund,have agreed on a mezzanine debt financing for a portfolio of primarily French renewable energy projects with a total peak capacity of 100 MW.
French renewable energy producer Neoen secures an unprecedented EUR 40 M junior green bond with an 18-year tenor.
Leading French renewable energy producer Neoen, and M&G Investments, a leading international asset manager, and the Sequoia Economic Infrastructure Income Fund, a Guernsey domiciled, closed-ended fund listed on the London Stock Exchange, have agreed on a mezzanine debt financing for a portfolio of primarily French renewable energy projects with a total peak capacity of 100 MW. The EUR 40 M financing closed on 30 October 2015 and was validated as a “Green Bond” following ESG (Environmental, Social and Governance) due diligence by Vigeo, a recognised sustainability expert, thus making Neoen one of the first Independent Power Producers to receive such independent Green recognition for a debt issuance.
This bond has an attractive tenor of 18 years, reducing refinancing risk, which was made possible thanks to the steady and predictable cash flows of high quality renewable energy assets. This secured bond is provided at a holding company level with limited recourse to Neoen SAS and is subordinated to senior debt in place at the individual project level. This financing allows Neoen to benefit from a competitive overall cost of capital for its projects, while maintaining its ownership, and provides M&G and Sequoia with their targeted risk-adjusted returns.
Neoen was advised by Green Giraffe (financial) and De Pardieu (legal). M&G and Sequoia were advised by DNV-GL (technical) and Watson Farley Williams (legal).
Xavier Barbaro CEO of Neoen, said: “Neoen’s first green bond is also a first for an Independent Power Producer. This achievement highlights the pioneering spirit of Neoen, the remarkable performance of our best-in-class assets, and our ability to partner with leading investors such as Sequoia and M&G. Thanks to this financing, Neoen will further expand its asset base, proving that full ownership of assets is wholly compatible with high growth”.
News
Green Giraffe targets Latin American power via new hire
INFRA LATIN AMERICA
25 September 2015
Green Giraffe targets Latin American power via new hire. Renewable energy finance specialist Green Giraffe has begun to look for advisory mandates in Latin America, new hire Andrew Eckhardt told InfraLatinAmerica.
Eckhardt, will lead the firm’s Latin America expansion. Prior to joining Green Giraffe this month,he was vice president of power generation and transmission business for KfW-IPEX Bank in New York. “The top three countries for renewables are Chile, Mexico and Brazil, but we also see space for our tailormade services in the smaller markets of the region” he said in a phone interview. “We are planning to offer our full product range, i.e. advising on equity and debt deals, as well as on strategic questions. We will also offer financial modelling services”.
Eckhardt will be initially based in Boston, with other team members in Paris and London also working on Latin America. A final decision has not been taken as to the location of a permanent office. At KfW-IPEX, his prime responsibility was to develop the bank’s American power generation and transmission business. He had previously spent several years in the bank’s renewable energy team in Frankfurt and lead the financing of more than 2 GW across onshore and offshore wind, as well as solar and biogas projects.
While a top player in Europe, regularly to be found at the top of the InfraDeals league tables, Green Giraffe is relatively unknown in Latin America. “Green Giraffe is planning to leverage existing relationships it has on the developer and investor side with big international funds and developers and add value with its unique sector and process know-how” Eckhardt said.
“We will look to add value by being sector focused and entering deals at an early stage,” he added. “We will leverage our extensive experience of being involved in big projects from an early stage. We will also continue to bring our strong knowledge of export credit agencies to the table to grow the franchise in Latin America,” he added.
The firm is taking a committed but cautious approach to the region. “We haven’t been set a target for the number of projects we need, but we want to build up the number while avoiding anything we can’t deliver on,” Eckhardt said.
Click here to view the full article on InfraLatinAmerica behind paywall.
Article
Veja Mate scores hat trick
PROJECT FINANCE INTERNATIONAL
24 September 2015
On June 29 2015, the financing for the 400 MW Veja Mate offshore wind project closed. The deal represented the third German offshore wind farm to achieve financial close since the applicable German regulatory framework – the EEG law – was reformed in the summer of 2014.
In this article Ranjan Mouilik, Global Head of Power at Natixis, and Jérôme Guillet, Managing Director of Green Giraffe give their view on the transaction.
Jérôme Guillet co-founded Green Giraffe in 2010 and was a Managing Director until 2021.
News
Walkyrie reaches financial close
Press release
9 September 2015
The sale by RP Global to Talanx of the 49.5 MW Walkyrie portfolio, comprising 3 onshore wind projects to be built in northern France, closed on 9 September 2015. Here’s the press release describing the transaction, as provided by the company at the time.
News
IJ Global League tables H1 2015
IJ GLOBAL
13 July 2015
IJ Global’s most recent financial advisory league tables (for the first half of 2015) show Green Giraffe keeping its top spot in the renewable energy sector, underlining the strength in our core business.
The all-sector table for Europe further shows that we are becoming one of the major financial advisory houses altogether.
Green Giraffe was ranked #1 for renewables top financial advisors (transaction value)
Green Giraffe was ranked #4 for Europe top financial advisors (transaction value)
News
Veja Mate reaches financial close
Press release
30 June 2015
The financing of over EUR 1,275 M of the 400 MW Veja Mate project, where Green Giraffe advised the borrower, closed on 29 June 2015. Here’s the press release describing the transaction, as provided by the company at the time.
News
Infographic: 5 years of success for Green Giraffe
Press release
9 June 2015
Green Giraffe celebrated its 5-year anniversary in May 2015. In this short period we have grown quite fast, opened new offices and closed many deals, to the obvious satisfaction of our clients – as we regularly get re-hired for new missions!
This infographic gives a nice overview of the key achievements of 5 years of Green Giraffe.
Presentation
Equity for near- and offshore wind
Kromann Reumert conference
4 June 2015
Jérôme Guillet, Managing Director of Green Giraffe, was invited to provide a panorama of the equity market for offshore wind at the Kromann Reumert conference on near- and off-shore wind in Copenhagen on 4 June 2015
Jérôme Guillet co-founded Green Giraffe in 2010 and was a Managing Director until 2021.
Presentation
Bankability concerns around CPV technology
C-11 Conference
19 May 2015
Green Giraffe was invited to speak to a finance discussion panel at the 11th Concentrated PV conference in Aix-Les-Bains and was asked to share its views on the main bankability concerns around the CPV technology. The presentation included an analysis of the risks as seen by potential power project lenders and a description of general debt sizing principles for non-recourse financing.
Click here for the wesbite of the conference
News
Offshore lessons from two continents
PROJECT FINANCE INTERNATIONAL
24 April 2015
Q1 2015 was quite an active period for offshore wind with the successful closing of two greenfield offshore wind projects, the 30 MW Block Island wind farm in the US, and the 332 MW Nordsee One project in Germany, as well as the refinancing of the 288 MW Baltic 2 in Germany.
This article focuses on the first two transactions, and while they are ostensibly very different in terms of regulatory context, technology, size and sponsors, both were structured in a manner that provides a good snapshot of current market conditions and trends. By Sophie Cherrier, a director of Green Giraffe in Paris who led the firm’s team advising on the Nordsee One project, and Jérôme Guillet, a managing director of Green Giraffe who was directly involved in the Deepwater project.
Click here for the full article (PFI website – subscription only)
News
Commercial banks to take larger share of European offshore financing
CLEAN ENERGY PIPELINE
30 March 2015
Developers of offshore wind projects in Europe will find it easier to attract financing for their large-scale projects as a result of the increasing appetite of commercial banks to invest in offshore wind projects in Europe, Jerome Guillet, told Clean Energy Pipeline.
According to Clean Energy Pipeline’s figures, more than 40 commercial banks have invested in the European offshore wind sector since 2006, a trend which Guillet envisages will increase as commercial banks become more and more comfortable lending to large-scale developments in the sector.
Green Giraffe acted as the financial adviser for Northland Power Inc. and RWE Innogy GmbH, the borrowers on the ambitious Eur1.2 billion, 332 MW Nordsee One offshore wind farm project, which hit financial close on March 19, 2015.
Guillet said: “Nordsee One reached financial close within the timetable they had targeted, which was an important goal of the sponsors, and it was the first large-scale deal with full construction risk [to be completed] without any multilaterals.”
The landmark deal saw approximately 70% of the project costs provided through a Eur840 million non-recourse construction and term loan from a group of 10 international commercial lenders: ABN AMRO, Bank of Montreal, Commerzbank, Export Development Canada, Helaba, KfW IPEX, National Bank of Canada, Natixis, Rabobank and The Bank of Tokyo-Mitsubishi.
The increasing involvement of commercial lenders on offshore wind deals will not be at the expense of multilateral banks, according to Guillet. In 2014, three European offshore wind projects secured $4.1 billion (Eur3.7 billion) of debt project finance, more than double the $1.6 billion invested in 2013, with multilateral backing making up a large proportion of the risk volume.
Guillet said: “The multilateral banks are able to put up large individual risk tickets, which is their main advantage, especially for big transactions, but there will be more and more deals without them.”
Guillet went on to say that he expects banks will offer more favourable interest rates for offshore wind project debt finance. According to Clean Energy Pipeline’s figures, debt finance for offshore wind projects is currently priced at between 250 and 350 bps above LIBOR.
Moving forward, Guillet said: “Eventually we should reach below 200 basis points over Euribor.”
The debt-to-equity ratio has remained relatively consistent for projects across the offshore wind sector. “It has been stable at 70:30, but it will probably at some point improve from the borrowers’ perspective to 75:25,” Guillet predicted.
Green Giraffe is currently acting as the financial adviser for the 400 MW Veja Mate project, a 67-turbine offshore project located in Germany’s North Sea, which is owned by Laidlaw Capital Group.
Although no banks have yet been mandated to provide financing for the deal, “the financial close of Veja Mate is being targeted for June”, Guillet said.
Jérôme Guillet co-founded Green Giraffe in 2010 and was a Managing Director until 2021.
News
Deal focus: Nordsee One offshore wind
Inspiratia
27 March 2015
The speed at which the 332 MW Nordsee 1 offshore wind farm signed off its financing – and the absence of any multilaterlal involvement on the deal – is further evidence of the increased maturity of the European offshore wind market.
Inspiratia published on 27 March 2015 an article about the Nordsee1 financing for which Green Giraffe acted as financial advisor.
The speed at which the 332MW Nordsee 1 offshore wind farm this month [March 2015] signed off its financing – and the absence of any multilaterlal involvement on the deal – is further evidence of the increased maturity of the European offshore wind market
By 18 March, just six months after it first approached banks, the €1.2 billion (£883.1m $1.3bn) Nordsee 1 offshore wind farm had not only signed financing agreements but also reached full financial close – the first major offshore financing in Germany for over two years.
For Northland Power, the Canadian IPP that owns 85% of the project, the swift transaction marks its second success in European offshore wind in the space of 10 months – after it took the Gemini project to financial close last May. No fewer than five lenders from Nordsee 1’s 10-bank club were fresh out of Gemini, while four of the others have experience in German offshore wind financings. In fact, of the entire bank club only NBC is new to the sector.
Unsurprisingly, given the current appetite for deals, the €840 million (£618.2m $919.6m) debt raise was massively oversubscribed. inspiratia understands that twice as many banks made offers, though only the final 10 were invited to participate. This appetite was high enough that Northland and utility RWE Innogy were able to fund the project solely with commercial banks – with EDC, an export credit agency, acting as an MLA on identical terms but without the interest rate swaps. Several sources note how multilaterals often slow deals down because of the greater due diligence required, and that their absence was a key factor – along with the bank club’s experience in offshore wind – in getting Nordsee 1 to financial close in just half a year.
So too was the involvement of Northland itself. Jérôme Guillet, managing director of the project’s financial adviser Green Giraffe, says, “Northland is being seen more favourably. It was the new kid on the block on Gemini, but now it is the kid that has done it – which is very important for banks.”
Utility trend
Those involved in Nordsee 1 – which will be built at a site around 50km north of Juist Island in the German North Sea – see its shareholder structure as a blueprint for future deals in European offshore wind. RWE Innogy had taken the project through development and sold off a majority stake to Northland last September, leaving it with a 15% equity interest. This decision is part of a wider strategy that will see the utility share the capital required for offshore projects in an effort to cut costs – partly in response to German energy reforms that have squeezed utilities’ margins and put pressure on their business models.
“RWE Innogy had done a lot of the development legwork already but wanted to get Nordsee 1 off its balance sheet because it’s a pretty big project,” says Adam Beaumont, director of finance at Northland.
“We’re seeing some of our peers come into this space and do the same thing as well. It’s about taking the fiscal responsibility off the utilities and onto the private power producers.”
Contingency funding
Cost overruns have affected the German offshore wind market in recent years, most notably on the Bard 1 project that is thought to have cost double its initial valuation of €1.5 billion (£1.1bn $1.6bn) when it was grid connected two years behind schedule in 2013. This caused problems around which parties – debt or equity – had to stump up the contingency funding. Previously, it has been commonplace to set aside roughly 12-15% on top of the original capex to cover delays and other cost overruns. This is now seen as a futile approach, with most saying contingency funding should be determined on a project-by-project basis.
Nordsee 1’s capex includes €35 million (£25.8m $38.3m) of base contingency, with an additional budget of €90 million (£66.2m $98.5m) to be committed by the debt and equity providers on a pro-rata basis if this limit is exceeded.
Also included in the project’s capex is around €70 million (£51.5m $76.6m) in pre-completion revenues. In the case of a wind farm, by the time the final turbine is commissioned, the first turbine is already generating electricity and making money. Sources who worked on the deal say it is becoming acceptable in the market to consider these revenues as quasi-equity, which Nordsee 1 has done.
EPCI contracting
A noteworthy aspect of Nordsee 1 in terms of project finance transactions is its use of so-called EPCI contracts – a variant of multi-contracting that, for example, will see one company not only design, manufacture and deliver the turbines, but also transport and install them. The idea is to take away the risk from the project and put it on the counterparty, which also means the project requires less contingency funding.
Three of the five engineering contracts are designed in this way:
Senvion – turbines
Bladt Industries – offshore substation
Siem – inter-array cables
Ranjan Moulik, global head of power and renewables at Natixis, one of the banks on the deal, says, “It’s about dividing the workflow into independent silos that have very few interfaces. It’s a much more efficient contracting structure than traditional multi-contracting, which have caused material delays and cost overruns on certain projects in the past.”
It’s a much more efficient contracting structure than traditional multi-contracting, which have caused material delays and cost overruns on certain projects in the past
While EPCI-type contracts have been used in Europe before, their presence in such a large project is said to be relatively unique. Northland and RWE have condensed potentially dozens of contracts into just five, with Ambau and GeoSea also contracted to produce and install the monopile foundations respectively. Meanwhile, Germany’s North Sea transmission system operator TenneT will connect the project to its DolWin 2 offshore converter station, which is scheduled to be installed in mid-2015.
Financing details
The project has a total capex of €1.2 billion (£883.1m $1.3bn), with around €840 million (£618.2m $919.6m) in non-recourse debt being provided for a gearing of 70:30 debt-to-equity. Green Giraffe, which had played a key role as financial adviser on Gemini, acted as financial adviser to the sponsors and once again ensured that the financing was concluded swiftly.
The debt was made up of a single-tranche 12-year construction and term loan, provided by the following 10-bank club:
ABN AMRO
Bank of Montreal
BTMU
Commerzbank
EDC
Helaba
KfW-Ipex
NBC
Natixis
Rabobank
The debt terms on Nordsee 1 show an improvement since Gemini, reflecting general market conditions and the strong appetite for the deal. Pricing is set at 275bp + Euribor during construction, before falling to 250bp upon operation and rising back to 275bp by the end of the 12-year tenor. As with Gemini, it is understood that the bank club plans to syndicate up to €10 million (£7.4m $10.9m) each to one or two additional banks – leaving them final tickets worth around €75 million (£55.2m $82.1m).
Under new German energy laws, the project will receive support through a contract-for-difference feed-in tariff for a 20-year period, structured as follows:
€194/MWh for the first eight years
€154/MWh for an additional 1.54 years
€39/MWh until year 20
As such, the banks on the deal will see just short of 2.5 years of uncontracted revenues. Meanwhile at P90 – the amount of electricity that the wind farm is 90% likely to produce over an average year – the DSCR is 1.3.
As well as financial adviser Green Giraffe, the sponsors were also advised by Linklaters (legal) and Chatham (hedging), while Clifford Chance (legal), Sgurr (technical), Benatar (insurance), Corality (model audit) and EY (tax) acted for the banks.
Conclusion
Banks still want the due diligence to be watertight… but if you meet that threshold, the liquidity is huge – which is the difference from before
Nordsee 1 follows Nordergründe – a more modest deal at 111MW, with debt provided by the EIB and KfW-Ipex – in reaching financial close in Germany this year, and precedes the likes of Veja Mate and Baltic 2 – both of which are on track to close in the coming months. All of this suggests that if 2014 was the year of the Dutch, 2015 is without a doubt Germany’s.
The transaction had so few complications that one adviser went as far as describing it as “the smoothest process we have ever had”. While the strong counterparties were important in achieving this, the deciding factor in its success was the appetite from a banking market that is hungry for deals.
Jérôme Guillet of Green Giraffe says, “There is still a cliff effect in offshore wind. It’s still quite hard to get a deal financed. The lending standards have not slipped; banks still want the due diligence to be watertight and for the structure to follow a certain number of rules. But if you meet that threshold, the liquidity is huge – which is the difference from before. Before it was adequate, and now it is plentiful. Projects still have to meet that high standard of quality, and if they do, they become eminently financeable.”
Click here for the full article
News
Nordsee One reaches financial close
Press release
19 March 2015
The financing of more than EUR 900 M of the 332 MW Nordsee One project, where Green Giraffe advised the borrower, closed on 19 March 2015. Here’s the press release describing the transaction, as provided by the company at the time.
Presentation
Financing offshore wind – the debt market
EWEA
12 March 2015
Jérôme Guillet, Managing Director of Green Giraffe, was invited to provide a panorama of the market for non recourse debt for offshore wind at the EWEA conference in Copenhagen on 10-12 March 2015.
Jérôme Guillet co-founded Green Giraffe in 2010 and was a Managing Director until 2021.
News
New York offshore wind cost reduction study
SPECIAL INITIATIVE ON OFFSHORE WIND
11 March 2015
Green Giraffe contributed to the study conducted by the University of Delaware’s for the NYSERDA setting out key strategic steps New York State can take to reduce costs of offshore wind power over the next decade.
Green Giraffe contributed to the study conducted by the University of Delaware’s Special Initiative on Offshore Wind (SIOW) for the New York State Energy Research and Development Authority (NYSERDA) setting out key strategic steps New York State can take to reduce costs of offshore wind power over the next decade.
The study finds that ongoing technology and industry advances combined with actions New York could take, independently or with other states, could lower costs for offshore wind power as much as 50% and bring the clean-energy source closer to realizing its potential for “delivering utility-scale renewable electric generation” to New York City and nearby areas such as Long Island.
News
Project Block Island wind farm reaches financial close
Press release
3 March 2015
The USD 290 M financing of the 30 MW Block Island offshore wind farm, developed by Deepwater Wind, closed on 27 February 2015. Green Giraffe advised the developer, notably on commercial arrangements.
Here’s the press release describing the transaction, provided by the project company at the time.Block Island Wind Farm Now Fully Financed
First U.S. Offshore Wind Project to Reach Financial Close Milestone Deepwater Wind Block Island, a wholly-owned subsidiary of Deepwater Wind, has fully financed the Block Island Wind Farm, reaching financial close on more than $290 million in project financing provided by Mandated Lead Arrangers Societe Generale of Paris, France, and KeyBank National Association of Cleveland, Ohio. In addition to its role as Mandated Lead Arranger, Societe Generale also acts as Financial Advisor for Debt Raise, Bookrunner and Administrative Agent. With these major agreements, Deepwater Wind has now secured all debt and equity funding needed to construct and operate its 30-megawatt Block Island Wind Farm – already under construction.
Deepwater Wind is the only United States offshore wind company to reach this critical milestone. The Block Island Wind Farm will be America’s first offshore wind farm.
“We’re ecstatic to reach financial close and thrilled to be partners with Societe Generale and KeyBank for this groundbreaking clean energy project,” said Deepwater Wind CEO Jeffrey Grybowski. “We’re full speed ahead and moving ever closer to ‘steel in the water.’”
“We at Societe Generale are proud to be a partner of Deepwater Wind, the U.S. leader in offshore wind power,” said Alexander Krolick, Director of Energy Project Finance in the Americas at Societe Generale. “Deepwater has assembled a world class management team and experienced contractors to develop this landmark project. As the first offshore wind farm to be developed in the U.S., the Block Island Wind Farm represents a milestone that expands SG’s offshore wind sector footprint outside of Europe and further strengthens our extensive global track record of advising clients and arranging debt for offshore wind projects.”
“Deepwater has long been at the forefront of offshore wind development,” said Andrew Redinger, managing director and head of KeyBanc Capital Markets Utilities, Power and Renewables Group. “We are pleased to provide financing for the first offshore wind project to be fully financed in the U.S., and look forward to working with Deepwater on future, transformative projects.”
The financing from Societe Generale and KeyBank is in addition to more than $70 million in equity funding already provided by Deepwater Wind’s existing owners, principally an entity of the D.E. Shaw Group.
Construction is well underway on the wind farm.
Alstom will supply five Haliade 150 6 MW offshore wind turbines for the project and has already completed the fabrication in Denmark of all 15 blades for the project.
Gulf Island Fabrication, Inc., began fabrication work in January 2015 at its facilities in Houma, Louisiana, on the wind farm’s five steel jacket foundations. That work is scheduled to be complete in several months.
Rhode Island-based Specialty Diving Services is expected to begin additional fabrication work on components of the foundation substructures at Quonset, Rhode Island in the coming weeks.
“Steel in the water” is planned for this summer, when all five foundations are scheduled for installation off the Block Island coast. The project will be in-service in the fourth quarter of 2016.
“We are on the cusp of bringing offshore wind from theory to reality in the U.S. We’re incredibly proud of our position at the forefront of the U.S. offshore wind industry,” Grybowski said. “We’ve brought together some of the best American and European expertise to build an outstanding project and finance team. We’re poised to launch a new American clean-tech industry, and it all starts here with our work on the Block Island Wind Farm.”
Latham & Watkins, LLP acted as borrower’s counsel; Hinckley Allen, LLP, of Providence, R.I., acted as local counsel; and Van Ness Feldman, LLP acted as regulatory counsel to Deepwater Wind Block Island.
Chadbourne & Parke, LLP acted as lenders’ counsel and Locke Lord Edwards, LLP, of Providence, R.I., acted as lenders’ local counsel.
Green Giraffe acted as financial advisor for commercial arrangements to Deepwater Wind Block Island, and Mott MacDonald acted as Independent Engineer.
About Deepwater Wind
Deepwater Wind is a leading U.S. offshore wind and transmission developer. The Company is led by a veteran team with extensive experience in developing renewable-energy projects. The Company is actively planning offshore wind projects to serve multiple East Coast markets located 15 or more miles offshore, including New York, Massachusetts, Rhode Island, and New Jersey as well as deep waters projects on the US West Coast. The Company’s Block Island Wind Farm is on schedule to become America’s first offshore wind farm.
News
PV magazine covers our report on merit order effect
PV MAGAZINE
4 February 2015
Henri Gouzerh and Nicolas Gourvitch proposed a method to quantify the merit order effect of solar PV in Germany, France, Italy, Austria and Switzerland for the period 2007-2013.
They calculated the savings for power purchasers generated by the decrease in electricity spot market prices observed when solar PV plants feed electricity into the grid. PV magazine is referring to this study in the below article.
European PV implementation has lowered prices by 3%
A new report makes the claim that the implementation of PV across Europe has led to a downward shift in electricity prices of 3 per cent.
The report, released by PV pressure group The Becquerel Institute in association with renewable energy financial advisor firm Green Giraffe and using data from GeoModel Solar, claims that the rise of PV has led to ‘significantly lower electricity prices’ in recent years. Titled Quantitative Analysis of the Merit Order Effect from Photovoltaic Production in Key European Countries, the report attempts to make the case that without PV production that the electricity market price in Germany, Austria, France, Switzerland, and Italy would have been 3 percent higher on average.
A statement on the Becquerel Institute’s website states, “The impact of PV on electricity prices introduces many questions on the future profitability of utilities under existing framework conditions, and even more the question of the future competitiveness of PV installations selling on the electricity markets. The conclusions of this study should be carefully analyzed: They show that the cost of PV electricity for the community could be reduced but also that the question of ensuring the profitability of most players during the energy transition will be the key of further PV development in Europe.”
However, careful analysis of the assumptions made in putting together the study indicate that the conclusions may be erroneous. Correlation may not be causation.
Firstly, the report assumes that any fall in electricity prices is entirely related to the implementation of PV. But there has been a steady and well-documented fall in oil prices in recent months. According to data obtained by the BBC, the price of oil has fallen from $110 a barrel to less than $50 since June.
Further assumptions are made about what even constitutes the price of electricity. Early on the report, the authors confess to making a ‘heavy assumption’ through only using market prices. There, they write, “Since only market prices were available the authors had to assume that all the electricity consumed is traded on the day-ahead market. This is a heavy assumption but traded volumes in European day-ahead markets have increased significantly over the last years, fluctuating above 40% since 2010 and reaching 52% of total electricity consumption in Q1 2013. Such assumption can further be justified by the fact that the mechanics of the day-ahead market are, in the long run, internalised in all the other contracts (long term purchase agreements, futures market…).”
The report also makes no reference to those that generate solar for their own use. “Thanks to the conjunction of these assumptions,” they write, “it appears reasonable to assume that all electricity (and therefore solar) produced is fed into the grid and consumed (no self-consumption, no export or import).”
In conclusion, the Becquerel Institute posted, “[The results] show that the cost of PV electricity for the community could be reduced but also that the question of ensuring the profitability of most players during the energy transition will be the key of further PV development in Europe. Considering solar PV energy only, this analysis does not embrace and quantify the total real effect, on a given electricity market, of introducing additional renewable electricity – mainly PV and Wind – in the generation mix of that market.”
The conclusions of the report, despite its limitations, should be considered as progress towards understanding the definite environment and economic benefits of renewable energy across Europe.
Click here for the article
News
InfraNews financial advisory League tables 2014
INFRANEWS
24 January 2015
Specialised infrastructure publication InfraNews has published its financial advisory league tables for 2014 and it shows Green Giraffe in good position in two tables.
Green Giraffe was ranked #1 for Financial Advisor by deal value
Green Giraffe was ranked #3 for Financial Advisor by deal count
Click here for the Infra news website
News
PFI League tables 2014
PROJECT FINANCE INTERNATIONAL
22 January 2015
PFI has published its financial advisory league table for 2014 and it shows Green Giraffe in several tables.
Green Giraffe was ranked #8 for global advisory mandates (number of mandates won)
Green Giraffe was ranked #13 for global advisories closed (in volume)
Green Giraffe was ranked #4 for EMEA advisory mandates won (number of mandates won)
Article
Monts du Lomont reaches financial close
Press release
6 January 2015
The EUR 50 M investment and financing for the construction and operation of a 31 MW onshore windfarm in France where Green Giraffe advised closed on 29 December 2014.
Here’s the press release describing the transaction.
Green Giraffe is pleased to announce that on 29 December 2014, Velocita Energy Development (“Velocita”) and Norddeutsche Landesbank Girozentrale (“NORD/LB”) have closed the financing of the first phase of the Monts du Lomont onshore wind farm located in the Franche Comté region in France. NORD/LB, in its capacity of sole lender and arranger, will provide facilities in a total amount of EUR 22 M for the first phase, with an option to raise an additional EUR 23 M for the second phase in the near future.
“We are delighted to close the financing of our first project in France and in the Doubs Valley, said Andrew Lee, Managing Director of Velocita. Monts du Lomont was conceived and developed for us by our partner Opale Energies Naturelles and is the pathfinder of a cluster of projects in the Doubs Valley totaling over 150 MW. Velocita’s French portfolio amounts to over 300 MW, 220 MW of which have or are about to secure permits and feed-in-tariff.”
This financing will enable the construction of a first phase of 14 MW during 2015, with a second tranche of 17 MW to become operational in 2017. The construction of Lomont will be managed by Velocita Energies Services S.A.S.
“We are proud to have advised on the financing for the Mont deLomont onshore wind project, which makes it an attractive investment opportunity for Velocita. The short two month period between the bank being mandated and financial close underlines the commitment and professionalism of all parties involved. said Jérôme Guillet, Managing Director at Green Giraffe.
The first phase will consist of 5 wind turbines near Crosey-Le-Grand while the second phase comprises 6 wind turbines to be located near Vellerot and Rahon. The design, civil and electrical works are to be provided by Artelia under an EPC contract. GE will supply its state of the art 2.78 MW turbines with a comprehensive 15-year operation and maintenance contract with a 3-year extension option.
Pedro Capote, director in the Energy Origination department at NORD/LB said: “We are very pleased to support Velocita in the financing of their first wind farm in France. France is one of NORD/LB core markets, where we have structured and financed already 330 MW in renewable energy projects”.
Green Giraffe acted as sole financial advisor to Velocita.
Velocita was also advised by Allen&Overy (legal), CGR (French public law), Natural Power (technical and energy yield), Greensolver (technical), Chatham Financial (interest rate hedging) and Filhet Allard (insurance).
Nord/LB was advised by Linklaters (legal), Mott MacDonald (technical), Ernst & Young (tax and model audit) and Marsh (insurance).
About Green Giraffe
Green Giraffe is a specialist advisory boutique focused on the renewable energy sector – and in particular offshore wind. Green Giraffe provides advisory services in non-recourse debt structuring, project equity advisory, buy-side and sell side advisory, project contracting support, market intelligence and modelling.
Green Giraffe was created in 2010 by renewable energy professionals and combines the expertise of project finance bankers and project developers with deep expertise in offshore wind. The team’s expertise was immediately recognized through the attribution of several advisory mandates (Northwind, C-Power, Meerwind) which have all closed successfully since then.
Green Giraffe rapidly developed its activities out of its original Utrecht and Paris offices across its core sectors of activity in Europe and North America, with mandates in the solar, onshore wind and offshore wind sectors. The company opened offices in London in September 2011 and Hamburg in January 2013, currently has a staff of 30 people and is actively engaged on projects in 8 countries.
Green Giraffe’s expertise has been recognised through multiple professional awards and requests to speak at professional conferences or to write articles for specialised publications.
News
PFI – Gemini 2014 Europe Power Deal of the Year
PROJECT FINANCE INTERNATIONAL
19 December 2014
The Gemini project, which Green Giraffe advised over more than 3 years, won the prestigious “Europe Power Deal of the Year” from Project Finance International. Green Giraffe advised the project on both equity and debt raise, and the transaction closed on 14 May 2014 for a total amount of EUR 2.8 billion, including a record EUR 2,099 M in non-recourse debt.
The Lake Turkana project, which Green Giraffe briefly advised in 2013, also received an award, as “African Power Deal of the Year”
See the full PFI Roll of Honour here: PFI Awards 2014 Roll of Honour
News
What does 2015 hold for wind investment?
WINDPOWER MONTHLY
18 December 2014
Jérôme Guillet was interviewed by Wind Power Monthly, along with other active participants in the market, about the prospects for the wind finance markets in 2015. What does 2015 hold for wind investment?
Jerome Guillet – managing director, Green Giraffe
2014 has been the year when people have started believing what we have said all along: that there is enough money for good offshore wind projects. Gemini is an obvious case in point, but more generally banks are beginning to do underwriting again and they are definitely more bullish about wind projects than they have been in recent years. The commercial terms are also becoming more aggressive on some transactions.
I have optimism that 2015 will be another positive year for offshore financing. The experience that people are getting from the current crop of projects will not go away and is going to be a useful foundation for the next round.
I think there will be a continued shift towards more debt financing because lenders are becoming more comfortable with the sector, and utilities are increasingly seeking third party finance. On the lending side, the field is pretty wide already and most of the big project finance banks are there. If you do get the underwriting market going, there will be more of the small banks coming into the field via syndications, but that’s going to be on an incremental process.
On the equity side we’re going to continue to see more types of players and more players in each category, as people start being willing to take more construction risk. On top of this, operational projects will be changing hands more often with more pressure on utilities to renew their balance sheets.
Debt and equity financing have become more project friendly, but developers still have to get it right. They have to be professional in every way, carry out due diligence properly and be clear as to what their actual goals are when going into financing. Many are still not aware of what they need to do to mitigate certain risks or transfer them to someone else on realistic terms. Banks will still not lend to projects that are not structured and managed properly.
Click here for the full article and the responses of other active participants
Jérôme Guillet co-founded Green Giraffe in 2010 and was a Managing Director until 2021.
Article
Offshore wind: Clean energy from the sea
COFFEETABLE BOOK
7 December 2014
Green Giraffe was one of the contributors to the book Offshore Wind: Clean energy from the sea published by Chris Westra. The book gives an overview of the different developments, technologies and offshore wind farms in Europe. Green Giraffe was invited to contribute as one off the important players in the market.
Offshore wind farms are large scale industrial projects and their cost run in the hundreds, or even billions of euros for the largest ones. Such projects have typically been funded by either « utilities » (large power companies like DONG) from their general revenues or by a combination of investors and banks providing dedicated financing for each individual project.
Offshore wind farms, like other renewable energy projects, should be looked at like infrastructure projects – a large upfront investment followed by many years of operation at a low cost. It means that the biggest component of the cost of electricity generated by such projects comes from the repayment over time of the initial investment – much like the reimbursement of a mortgage on a house – and it is naturally very sensitive to the interest rate at the moment of investment.
Compared to traditional power plants, like gas-fire power plants, where the cost of electricity is mainly driven by the price of gas over time, the economics of offshore wind farms are quite different – in particular, the cost of offshore wind electricity is fixed and will not change over the period of repayment of the investment, which is a very valuable feature in our world of rapidly changing energy prices.
Electricity cost estimates depend heavily on assumptions made. Given that offshore wind projects need to repay the upfront investment over a long period of time, predictable revenues are the best way to do that. Financing costs will be lower under schemes whereby projects get a fixed price, like the «feed-in tariffs » that exist in many European countries. Thus both the nature of the rules that apply to renewable energy projects and their stability over time have an influence on the cost of energy, almost as much as the price level itself.
In countries with a stable regulatory environment, both financial investors and banks are willing to provide funding at increasingly competitive rates, as they get more and more comfortable with the risk of building such big projects in the middle of the sea. Banks are typically willing to lend up to 70% of the cost of projects on a « non-recourse » basis, i.e. they get repaid only if the projects generate sufficient revenues. with no obligation for the project owners to pay the banks if the project fails to do so. Interest rates for such loans are currently in the 4-5% range over 15 years, while investors will expect a return of 8-12% for their share of the investment.
Naturally, offshore wind farms need to be insured, like any big industrial site, and insurance coverage is available during construction and operations, covering risks (and loss of revenue) associated with any accident, unusual weather conditions or other damage caused by an external cause.
The full book can be ordered here
News
Top 100 Power People in Wind (2014)
A WORD ABOUT WIND
11 November 2014
Jérôme Guillet, Green Giraffe Managing Director, was for the third year running recognized as one of the “top 100 power people” by specialized publication A Word About Wind, with rank #21.
“Guillet is one of the most respected individuals working in wind energy finance. It is no surprise, therefore, that his team at Green Giraffe advised on equity raising and debt arranging for the largest offshore wind financing to date: the €2.8bn financing for the 600MW Gemini project, which closed in May 2014. We have no doubt that Green Giraffe will advise on more blockbuster deals in the coming years.”
Click here for the full report (behind pay wall)
Jérôme Guillet co-founded Green Giraffe in 2010 and was a Managing Director until 2021.
News
Windpower top 30 (2014)
WINDPOWER MONTHLY
1 November 2014
Windpower Monthly has published its fourth yearly list of the most influential people in the wind industry. Jérôme Guillet, Managing Director of Green Giraffe is again included in the list.
“24. Jerome Guillet, MD, Green Giraffe”
One of only two financial entries in this year’s Top 30 list, Jerome Guillet earns his place as a consistent supporter of wind, largely offshore.
He founded Green Giraffe in early 2010 with fellow managing director Niels Jongste. Since its inception, the company has grown from ten people to the current 25. While the bank started out with relatively limited ambitions, to provide financing solely for offshore wind projects, it has since broadened its horizons to take in new fields, and is now active across the whole renewable energy market.
However, it is still its work with offshore developers that makes it stand out – most significantly the 600MW Gemini wind farm in the Netherlands. Guillet’s himself was key to closing the deal, working with developer Northland Power throughout the financing and project structuring.
The importance of the Gemini financing stems from the fact that more projects are being financed through debt due to the inability of large utilities to fund projects outright. It is the largest non-recourse financing for an offshore wind farm to date and is seen as setting the agenda for future projects, particularly those developed by independent power producers. Close to EUR 3 billion was raised from the financial markets.
Green Giraffe can also count the financing of a number of other major offshore projects among its achievements, including the 216MW Northwind, 288MW Meerwind, 367MW Walney and 195MW Agrowind projects. It is currently working on the 30MW Block Island project in the US, together with the 332MW Nordsee 1 and 400MW Veja Mate developments in Germany.
While Guillet and Jongste hold the same position at the company, Guillet has a higher profile in the wind industry, and makes regular appearances on the conference circuit.
Click here for the Windpower Monthly top 30 article
Jérôme Guillet co-founded Green Giraffe in 2010 and was a Managing Director until 2021.
Presentation
Merit order effect: the case of solar PV and electricity spot markets
EU PVSEC 2014
24 September 2014
This presentation proposes a method to quantify the merit order effect of solar PV in Germany, France, Italy, Austria and Switzerland for the period 2007-2103.
Henri was invited to speak during the EU PVSEC in September 2014. This presentation describes the article in which Henri Gouzerh and Nicolas Gourvitch propose a method to quantify the merit order effect of solar PV in Germany, France, Italy, Austria and Switzerland for the period 2007-2013. They calculated the savings for power purchasers generated by the decrease in electricity spot market prices observed when solar PV plants feed electricity into the grid. The overall savings amounted to EUR 20 Bn across those five European countries for the 2007-2013 period, and were worth about 100 EUR per MWh of PV electricity fed into the grid, underlining the social value of the power generated by PV.
Article
Solar PV drives down electricity market prices in Europe
EU PVSEC 2014
1 September 2014
Henri Gouzerh and Nicolas Gourvitch proposed a method to quantify the merit order effect of solar PV in Germany, France, Italy, Austria and Switzerland for the period 2007-2013.
They calculated the savings for power purchasers generated by the decrease in electricity spot market prices observed when solar PV plants feed electricity into the grid. The overall savings amounted to EUR 20 Bn across those five European countries for the 2007-2013 period, and were worth about 100 EUR per MWh of PV electricity fed into the grid, underlining the social value of the power generated by PV.
Henri Gouzerh and Nicolas Gourvitch presented this article on the 31ste European Photovoltaic Solar Energy Conference and Exhibition in Hamburg in September 2015.
They were selected as the winner of the Poster Award by the scientific committee in the thematic area of “PV – A major electricity source”.
News
Infra news financial advisory league tables H1 2014
INFRA NEWS
30 July 2014
Specialised infrastructure publication Infra news has published its financial advisory league table for the first half of 2014 and it shows Green Giraffe in several tables.
Global financial advisory league table
Company
USD M
Deals
1
Royal Bank of Canada
9,309
11
2
BNP Paribas
9,297
9
3
PricewaterhouseCoopers
6,858
9
4
Danske Bank
6,493
2
5
HSBC
5,995
4
6
Citigroup
5,560
3
7
Morgan Stanley
5,237
5
8
Deutsche Bank
4,998
6
9
Crédit Agricole CIB
4,868
6
10
Barclays
4,343
5
11
Green Giraffe
4,333
2
12
Goldman Sachs
4,229
7
13
Macquarie Capital
4,094
5
14
Royal Bank of Scotland
3,508
3
15
Deloitte
3,401
9
EMEA financial advisory league table
Company
USD M
Deals
1
BNP Paribas
8,821
7
2
Danske
6,493
2
3
HSBC
5,995
4
4
Citigroup
5,560
2
5
PricewaterhouseCoopers
5,073
7
6
Deutsche Bank
4,998
2
7
Crédit Agricole
4,868
6
8
Green Giraffe
4,333
2
9
Barclays
4,113
4
10
Royal Bank of Scotland
3,508
3
Renewables financial advisory and bank debt league table
Company
USD M
Deals
1
Green Giraffe
4,333
2
2
Citigroup
1,088
1
3
Royal Bank of Canada
1,088
1
4
ANZ
1,000
1
5
Evercore
807
2
Click here for the Infra news website
News
Westermeerwind reaches financial close
Press release
28 July 2014
The EUR 320 M Westermeerwind financing, where Green Giraffe advised, closed on 24 July 2014. Here’s the press release describing the transaction, as provided by the company at the time.
A consortium of banks headed by ING and Rabobank as structuring banks will be funding Wind Farm Westermeerwind in Noordoostpolder. In addition to ING and Rabobank , ASN Bank and Triodos Bank are also providing funds, part of which is guaranteed by EKF, Denmark’s export credit agency. The financing agreements were signed in Amsterdam yesterday. The total funding involves a sum of approximately EUR 320m. Managing Director Anne de Groot of Westermeerwind: “We are happy to reach this milestone together with the Dutch banks, Danish EKF, Siemens and Eneco. Thanks to the persistence and dedication of the initiators of this windfarm, now, after 18 years after plans were devised, Holland’s largest near-shore windfarm can be build’.
Siemens will develop the largest near-shore wind farm in the Netherlands based on a turnkey agreement and will operate the wind farm for a minimum term of fifteen years. Several Dutch companies will contribute to the project as subcontractors, including Ballast Nedam and Mammoet for foundations and installation of the windmills, and VSMC (Visser & Smit Marine Contracting) for the cabling to the electrical substation. Energy company Eneco will purchase electricity from the wind farm for fifteen years, and supply is due to start towards the end of 2015. Ventolines, who since 2007 managed the development stage, will also be responsible for project management during the construction and asset management stage on behalf of the initiators of the project.
News
Project finance advisory league table H1 2014
Inspiratia
15 July 2014
Specialised trade publication inspiratia has published its financial advisory league table for the first half of 2014 and it shows Green Giraffe in second place.
Financial Advisor
USD M
1
PwC
4,772
2
Green Giraffe
4,615
3
HSBC
4,336
4
KPMG
3,108
5
Credit Agricole
1,721
6
Macquarie Capital
1,694
Click here for the full article on the inspiratia website (behind paywall)
Presentation
The offshore wind French market: past, present and future
Windforce Bremen
18 June 2014
Pierre Etienne Claveranne was invited to speak at the Windforce conference in Bremen about the French offshore wind market. His presentation provided a description of the regulatory framework, the recent tender process and its winners and the likely bankability of the proposed projects.
Presentation
Financing offshore wind – the Gemini project
Global offshore wind 2014, Glasgow
12 June 2014
Sophie Cherrier was invited to speak at the Renewable UK conference in Glasgow about the financing of the offshore wind farm Gemini. Her presentation provided an overview of the financing structure, the challenges of reaching financial close on a 600 MW wind farm and the lessons learned.
News
Gemini ‘proves banks’ appetite to lend to offshore wind’
ENVIRONMENTAL FINANCE
6 June 2014
The financial close of the Gemini offshore wind project will help pave the way for further deals, and has confirmed that banks have an appetite for funding the sector, a leading advisor has claimed.
The 600MW Gemini wind farm off the Dutch coast recently secured €2.8 billion ($3.8 billion) of project financing, putting it on track to start operation in 2017.
Not only was the deal the largest of its kind, but it has also helped demonstrate that banks continue to be willing to finance construction in the sector, Jérôme Guillet, Paris-based managing director at Green Giraffe, which advised on the deal, told Environmental Finance.
“The perception – mainly in the London market – had been that construction risk is not bankable,” he said. “[But] the debt part of the deal was oversubscribed, which shows that the structure was attractive to the market.”
He added: “There’s appetite for well-structured products – banks do want to do offshore wind finance. There have not been that many properly structured projects on the market. Banks will fund long-term assets they like.”
He said that convincing banks to lend to offshore wind projects had previously “been perceived as a struggle by some players”.
He pointed to Lincs or London Array off the UK coast as examples of deals that “took many years to get to final close”.
The Gemini deal involved more than 20 parties from North America, Europe and Asia, including 12 commercial creditors. Canadian renewable energy firm Northland Power owns a 60% share in the project, with turbine manufacturer Siemens taking a 20% stake, and the remainder split between dredging and marine contractor Van Oord and Dutch utility HVC. Between them, they provided more than €400 million of equity.
The deal will help more banks to increase their knowledge of the sector and make them more likely to invest in it in the futute, added Guillet.
“Each deal helps the sector by building up more experience. This deal brought some Canadian banks into the sector, because Northland is Canadian, while Natixis, Deutsche and Sumitomo Mitsui Banking Corporation took more senior positions than in previous deals.”
Another interesting part of the deal was that the main sponsor was not a large utility, as has often been the case with previous deals.
“Northland is not a large European utility and it shows it can be done by relatively smaller players,” he added.
Click here for the article
Jérôme Guillet co-founded Green Giraffe in 2010 and was a Managing Director until 2021.
News
Deal focus: Gemini offshore wind
Inspiratia
29 May 2014
Financial close on the 600MW Gemini offshore wind farm in the Netherlands this month underlined the importance of extensive prep work ahead of launching a debt raise in the sector.
The €2.8 billion (£2.33bn US$3.78bn), 600MW Gemini offshore wind farm financial close earlier in May offered a case study into how to finance deals in the sector, with meticulous preparatory work on the part of financial adviser Green Giraffe allowing the debt raise to complete in just 6 months.
Most importantly, the turbine and EPC contracts for Gemini were negotiated and signed off ahead of taking the project to the banking market – in contrast to previous offshore wind financings in markets such as the UK and Germany. Green Giraffe, joining the project at an early stage, played a key role at this point, negotiating deals with turbine supplier Siemens and EPC contractor Van Oord until it was convinced terms would be ones with which banks were comfortable.
This preparatory work certainly appears to have paid off, as the 12-bank lending club providing debt to the deal, in addition to the EIB, and the three export credit agencies, were all happy with the contracts at the first time of asking.
Contract consensus meant the Gemini sponsors thus avoided becoming embroiled in the type of 10 to 20-party talks that have bedeviled other transactions in the sector, where debt terms were sent out to market ahead of contract terms being finalised.
“In terms of risk, this was very clean – and much cleaner than the multi-contract rubbish which has led to delayed or aborted offshore wind financings in the UK or Germany over the past 5 years,” one banking source involved in the deal said.
Strong sponsor
Canadian IPP Northland Power’s role as the main equity provider to the transaction was also important to its success, with lenders emphasising the management and balance sheet capacity that the group was able to bring to the table. Offshore projects which have been largely driven by financial investors have been more challenging prospects to finance, lenders say.
As to lender appetite, the presence of a 12-bank club – providing a €862 million commercial debt tranche – is a clear indication that the offshore wind market is now one which is deal-constrained rather than liquidity-constrained.
Indeed, the underwriting of the debt on the part of 12 banks, and their subsequent launch of a syndication of the debt last week, was evidence of their confidence that there are further lenders in the market prepared to take up the debt. There are now believed to be around 30 international banks with credit committee approval to lend to construction stage offshore wind deals.
Project history
The Gemini offshore wind farm is located 85km off the Dutch coast near the German border. The project was initially developed by BARD Offshore, which successfully bid for the incentive underpinning offshore wind, the Dutch SDE, in 2010. Developer Typhoon Offshore subsequently acquired the development at this point.
Contractors Siemens and Van Oord were brought on board in 2011-2012, under the same 2-contract structure used for the financings of the Q7 and Belwind offshore wind farms, with both groups agreeing to make equity contributions to the development.
At this point, Typhoon offshore’s equity raising process began – and Canadian IPP Northland Power reached a deal to take a 55% stake in the project in August 2013. The launch of the debt raise followed in November.
The incentive underpinning offshore wind consists of a 15-year contract for difference, as in the UK, whereby the Dutch government tops up the market price to a fixed level of €168.9/MWh.
The Dutch mechanism has further features that make overall revenues less sensitive to the actual production level over a relatively wide window of wind levels, according to Green Giraffe. Various caps also ensure that the amounts committed by taxpayers are fully known in advance, providing a high level of predictability of revenues, the group says.
Deal structure
The project has a total capex – excluding contingencies – of €2.8 billion (£2.33bn US$3.78bn), with around €2 billion in senior debt being provided for a gearing of 70:30 debt-equity.
Gemini’s equity investors include:
Canadian IPP Northland Power (55%)
Siemens (20%)
Van Oord Dredging and Marine Contractors (10%)
HVC (10%)
Typhoon Offshore (5%)
The financing was made up of the following components:
€450 million (£366m $618m) in equity
€200 million (£163m $274m) in mezzanine finance
€200 million (£163m $274m) in pre-construction revenue from the first turbine installations
€862 million (£733m $1.236bn) in senior debt provided by 12 commercial banks
€540 million (£440m $741m) in ECA facilities provided by EKF, Euler Hermes, and Delcredere Ducroire
€587 million (£400m $687m) in senior debt to be provided by the EIB
The project’s sponsors have also set aside a €150 million equity contingency pot, while senior lenders have set aside €130 million.
The 17-year debt – including the 3-year construction term – is structured as a mini-perm, with full cash-sweeps kicking in from year 8 (2022), to force a refinancing of the project at this point.
Pricing is set at 300bp + Euribor during construction, falling to 275bp at start of operation, rising with step-ups to 325bp by the end of tenor. The all-in cost of debt comes to a little under 5%, taking into account fixed rate swaps.
The 12-bank club consisted of the following lenders:
ABN AMRO Bank
Bank of Montreal
BNG
BNP Paribas
BTMU
CaixaBank
CIBC
Deutsche Bank
EDC
Natixis
Santander
SMBC
Advisors
In addition to financial adviser Green Giraffe, Gemini was also advised by Clifford Chance Amsterdam (legal), AON Risk Solutions (risk management and insurance), Loyens & Loeff (tax) and Chatham Financial (hedging).
The lenders were advised by Mott MacDonald (technical), Allen & Overy (legal), Poÿrÿ Management Consulting (market), Benatar & Co (insurance) and Corality Financial Group (model audit).
The EIB was advised by Freshfields (legal), while EKF and Delcredere|Ducroire were advised by Kromann Reumert (legal), and Euler Hermes was supported by EY/AHB acting as an independent chartered auditor for the Federal German Government.
Click here for the full article
Article
Gemini financing – what it means for the market
RECHARGE
28 May 2014
The recent closing of the largest offshore wind farm financed to date on a non-recourse basis sends positive signs for the industry and provides a good overview of today’s banking market and new type of investors interested in entering the sector.
Offshore wind is still more expensive than other technologies to generate power, and thus its development is overwhelmingly driven by the need to have a supportive regulatory framework.
Key regulatory drivers include the price regime but also permitting mechanisms and access to the grid. All of these influence the economics of offshore wind projects and how they can ultimately be financed.
Funding these projects requires equity and, potentially, debt. Equity-only transactions, or “balance sheet” investments have been typically made by utilities. Non-recourse debt in addition to equity has typically been used by smaller developers lacking the funds to build the projects on their own, or by financial investors seeking to create leverage and increase equity returns.
Approximately a quarter of the 7GW of current operating capacity has been financed with debt, but the proportion has been increasing in recent years (to around 40% of new projects), and the increasing strains on utility balance sheets (due to a drop in wholesale prices, itself caused by the increasing penetration of renewables, which replace traditional plants in the merit order supply curve) have made them either consider project finance themselves, or sell all or part of their projects to investors that do.
The equity market
With utilities increasingly active on the sell side, investors have been able to find opportunities with varying risk profiles – and thus enabling the entry into the equity market of new players such as infrastructure and pensions funds, private-equity groups or corporations with specific market strategies. The first sector to see regular activity has been the market for already-built offshore wind farms, with investors willing to take long-term operating risk but reluctant to take construction risk.
However, as more offshore wind assets have come up for sale, the universe of investors has grown even more, with IRR targets going down. Some investors are thus now looking to take construction risk to improve returns (and obtain the double digits IRRs no longer available for operating assets).
In 2013, the Butendiek transaction was the first time pension funds and infrastructure funds took full construction risk in offshore wind, highlighting the increased sophistication of investors and the increasing understanding by financial markets of the risks associated with construction at sea. Ongoing transactions with respect to the Westernmost Rough (UK) and MEG1 (Germany) projects suggest that more investors are willing to take such risks today.
The debt market
Over the past three years, project finance funding has represented around 40% of the net amounts invested in offshore wind, and the market is increasingly mature, with predictable commercial terms and requirements from the lending market. Due diligence standards and main covenants are now well understood by lenders, advisors and experienced developers, across the various European countries where the industry has developed.
Offshore wind is now unambiguously “strategic” for many banks. The commercial bank market is broadening, with more actors expressing their appetite each year. More than 30 commercial banks have taken offshore wind risk so far and more are interested to enter the market. In fact, banks were actually frustrated last year not to be able to lend more to the sector, as too few projects (of the requisite quality) came to the market.
The Gemini project (600MW, the Netherlands) was able to raise more than €2bn in lending commitments just a few weeks ago (more than double the size of the previous largest such transaction), taking advantage of such favorable conditions, as further described below. We estimate that at least €4-5bn could be provided by lenders on a yearly basis on commercial terms, and we see signs that commercial banks are willing to consider underwriting good projects.
Multilateral finance institutions, development banks and export credit agencies have been and remain instrumental to get deals done, typically providing half the liquidity in any given project, and terms largely similar to those accepted by commercial banks. Their main advantage is to provide large individual commitments, allowing a reduction in the number of parties involved in any given transaction. During times of stress following the financial crisis, they also provided valuable funding capacity to the market.
Non-recourse finance requires a specific discipline
A number of rules must be respected to gain access to project finance. Beyond a general requirement for more conservative assumptions than the investors with respect to production levels, constructions contingencies or operating expenses, banks tend to demand more influence than usual on the contractual structure and commercial terms, as well as more transparency on technology, supply chain and contractors than investors and in particular utilities are used to.
It has thus been advisable to involve banks – or advisors familiar with the requirements of lenders – already when structuring the corporate and contractual structure of any offshore wind project.
The Gemini precedent
The financing for the Gemini project closed on 14 May 2014, for an amount of €2.1bn in long-term debt, making it by far the largest offshore wind financing. Lenders include 12 commercial banks (which provide €1bn altogether, also the largest commercial tranche ever), the European Investment Bank, and three export credit agencies (Euler-Hermes, EKF and Delcredere/Ducroire).
Most of the terms of the financing are in line with previous transactions, such as a gearing of 70:30, debt sizing over the full life of the tariff regime, and stringent due diligence requirements.
Nevertheless, the financing of such a large scale project (at 600MW) provides a number of insights for the industry:
Banks continue to be willing to take construction risk for well-structured projects, with a general trend towards a very limited number of construction contracts (two only in that case).
The universe of banks active in the sector continues to grow, with several newcomers in this transaction coming in and relying on experienced players who took more active roles.
The size of commitments provided by commercial banks is growing and allows developers to raise substantial amounts on a non-recourse basis on market standard terms.
There is no need for a utility to be involved in such a large project: Gemini was developed by a small but very experienced developer (Typhoon), and was purchased at financial close by a consortium led by Northland Power, a Canadian IPP with a substantial track record in power-sector project finance but no previous exposure to offshore wind. The strong contract negotiation, project management and financial structuring skills of the owner group were seen by the banks as one of the key features of the transaction.
The Contract for Differences mechanism in place in the Netherlands was accepted by the lending community and will likely be seen as a relevant precedent for future UK transactions.
As per the standard line of Green Giraffe at conferences, “there is enough money for good projects” and Gemini demonstrates that beyond any possible doubt.
This article was first published on www.rechargnews.com
News
Recharge announces 4040 new energy leaders
RECHARGE
19 May 2014
Global renewables magazine and news service Recharge has launched a new initiative aimed at bringing together the world’s foremost young energy pioneers. Pierre-Etienne Claveranne is included in the list.
The 40 are made up of a diverse group of individuals from across the globe, from the worlds of renewables technology, finance, development, social engagement and advocacy. The list includes people from major wind and solar companies, banks, investment funds, crowd-funding platforms and governments.
Click here for the full article
News
Project Gemini reaches financial close
Press release
14 May 2014
The EUR 2.8 bn financing of the 600 MW Gemini project, where Green Giraffe advised the borrower, closed on 14 May 2014. Here’s the press release describing the transaction, as provided by the company at the time.
Largest European Offshore Wind Financing To Date
Project Gemini Reaches Financial Close
At €2.8 billion, it is the largest-ever project financing to date for an offshore wind farm;
Strong equity consortium consisting of Northland Power Inc., Siemens Financial Services, Van Oord Dredging and Marine Contractors BV and N.V. HVC;
Two-contract structure for turbine supply and project construction;
Strong revenues through Netherlands sustainable energy subsidy (SDE) program;
Project will play an important role in achieving European Union’s Renewable Energy Directive which calls on Member States to reach a 20% share of energy from renewable sources by 2020; and
Gemini will be the largest offshore wind farm in the North Sea, which has one of the strongest and most reliable wind resources in the world.
Project Gemini is pleased to announce that it has placed all of the €2.8 billion of equity and debt required for the project. More than 22 parties, including 12 commercial creditors, 4 public financial institutions, 1 pension fund together with Northland Power Inc. as subordinated debt lenders and the 4 members of the equity consortium were involved in the signing of the financing contracts. 70 percent of this budget will be provided on the basis of project financing, making Gemini the largest-ever project financed offshore wind farm.
Presentation
Financier’s perspective on project finance for R3 construction and O&M
Windpower monthly Vessels and acces
13 May 2014
Matthew Taylor was invited to speak at the annual Vessels and Access conference in London. The presentation was a general overview of the equity and debt market in offshore wind, and more specifically on the challenges relating to financing Round 3 in the UK in the light of the perceived additional scale and technical challenges.
Presentation
The value of offshore wind
DNV GL Offshore wind conference
2 April 2014
Jérôme Guillet was invited to speak at the DNV GL Offshore wind conference in Hamburg about the economics of offshore wind. The presentation discusses the cost, the value and the price of offshore wind and underlines how regulatory decisions can drive each of these.
Jérôme Guillet co-founded Green Giraffe in 2010 and was a Managing Director until 2021.
News
NOP Agrowind reaches financial close
Press release
17 February 2014
The EUR 350 M NOP Agrowind financing, where Green Giraffe advised, closed on 14 February 2014. Here’s the press release describing the transaction, as provided by the company at the time.
A banking consortium consisting of the European Investment Bank, the German KfW IPEX-Bank and Rabobank granted a loan of 350 million euros in total to NOP Agrowind. NOP Agrowind will use this loan to build 26 wind turbines with a total power output of 195 Megawatt. These wind turbines are part of the 86 wind turbines of Windpark Noordoostpolder, which will become the largest wind farm in the Netherlands.
NOP Agrowind is an initiative of agricultural entrepreneurs along the Westermeerdijk and Noordermeerdijk in the North East Polder (the Netherlands). They will invest together in the construction of 26 Enercon E-126 wind turbines on their lands. The total investment amounts to circa 420 million euros. The turbines have a tower height of 135 meters, a rotor diameter of 127 meters and an installed capacity of 7.5 Megawatt each. The development of the NOP Agrowind project started in 1994. In spring 2013 the construction process started with the construction of the infrastructure works for roads and hardstands. The piles have already been driven for the majority of the wind turbines. The first turbine is planned to start generating power as of September 2014. It is expected that the project will be completed in 2016.
News
Banks have capacity to meet offshore wind project finance demand in 2014
CLEAN ENERGY PIPELINE
3 February 2014
Clément Weber was interviewed by Clean Energy Pipeline, the renewable energy publication, and asked about the available lending capacity for offshore wind in the project finance market in 2014.
Clément Weber, the head of our London team, was interviewed by Clean Energy Pipeline, the renewable energy publication, and asked about the available lending capacity for offshore wind in the project finance market in 2014. Clément confirmed that the debt market was not a bottleneck for offshore wind and that there was strong bank appetite for good projects.
News
PFI League tables 2013
PROJECT FINANCE INTERNATIONAL
22 January 2014
PFI has published its financial advisory league table for 2013 and it shows Green Giraffe in several tables.
Green Giraffe was ranked #10 for global advisory mandates (number of mandates won)
Green Giraffe was ranked #12 for Americas advisory mandates (number of mandates won)
Green Giraffe was ranked # 8 for EMEA advisory mandates (number of mandates won)
Green Giraffe was ranked #28 for global advisories closed (in volume)
News
Top 100 Power People (2013)
A WORD ABOUT WIND
21 December 2013
Jérôme Guillet, Green Giraffe Managing Director, was for the second year running recognized as one of the “top 100 power people” by specialized publication A Word About Wind, with rank #27.
“Guillet remains one of the most influential and respected individuals working in wind energy finance today. And for good reason, too. Green Giraffe’s team are challenging some of the more traditional financial advisories with their specialist knowledge and unparalleled experience. The impressive growth of the company this past year suggests that more is yet to come.”
Jérôme Guillet co-founded Green Giraffe in 2010 and was a Managing Director until 2021.
Article
Non, le financement de l’éolien offshore n’est pas un problème
GREENUNIVERSE (IN FRENCH
28 November 2013
Jérôme Guillet was interviewed by French sectorial publication GreenUniverse on the second tender for offshore wind projects in France and the prospects for their financings.
“Non, le financement de l’éolien offshore n’est pas un problème”
A deux jours de la clôture du deuxième appel d’offres français, l’éolien offshore connaît des ratés au Royaume-Uni et en Allemagne. Les difficultés techniques risquent-elles de provoquer des difficultés de financement ? Non, répond Jérôme Guillet, directeur de Green Giraffe, banque d’investissement spécialisée dans les énergies renouvelables, et notamment l’éolien offshore. Pour lui, les bons projets trouvent des fonds, à condition de respecter certaines règles.
(behind paywall)
Jérôme Guillet co-founded Green Giraffe in 2010 and was a Managing Director until 2021.
News
Meerwind gets PE approach
PFI 500TH EDITION SPECIAL REPORT
18 October 2013
The article describes the novel approach to offshore wind used by private equity investor Blackstone, including the non-recourse debt financing they put in place with the support of Green Giraffe as financial advisor.
Click here for the full PFI 500th edition special report
Presentation
Quantative analysis of the merit order effect
EU PVSEC 2013
7 October 2013
Nicolas Gourvitch proposed a method to quantify the merit order effect in Italy. He was asked to present his article at EUPVSEC 2013 in Paris.
Nicolas was invited to speak during the EU PVSEC in October 2013. This presentation describes the article in which Nicolas Gourvitch and Henri Gouzerh propose a method to quantify the merit order effect in Italy for the period 2006-2012. They calculated the savings for power purchasers generated by the decrease in electricity spot market prices observed when solar PV plants feed electricity into the grid. The overall savings amounted to more than EUR 2 Bn for the country as a whole in 2012, and were worth more than 100 EUR per MWh of PV electricity fed into the grid, underlining the social value of the power generated by PV.
Presentation
Financing offshore wind: past, current & future trends
RUK Offshore Wind delivery group
7 October 2013
Clément Weber was asked to speak about offshore wind financing for the Renewable UK Offshore wind delivery group.
Article
Quantative analysis of the merit order effect from pv production
EU PVSEC 2013
3 October 2013
Nicolas Gourvitch and Henri Gouzerh proposed a method to quantify the merit order effect in Italy for the period 2006-2012. They calculated the savings for power purchasers generated by the decrease in electricity spot market prices observed when solar PV plants feed electricity into the grid.
The overall savings amounted to more than EUR 2 Bn for the country as a whole in 2012, and were worth more than 100 EUR per MWh of PV electricity fed into the grid, underlining the social value of the power generated by PV.
Presentation
Financing large scale deployment of deep water wind farms
Deep Water Wind Farms Seminar
25 September 2013
The presentation discusses the factors considered by investors in taking an investment decision in offshore wind and the impact on these factors of moving to deeper water.
Presentation
Market trends defy negative sentiment on PF for offshore wind
Renewable UK
19 June 2013
Clément Weber gives Green Giraffe’s views on how the project finance market can help the country’s ambitious offshore wind targets be reached.
Clément Weber spoke at Renewable UK’s offshore wind conference in Manchester and shared Green Giraffe’s views on how the project finance market can help the country’s ambitious offshore wind targets be reached. The presentation (attached) goes through lessons from recent non-recourse transactions, draws a comprehensive picture of the current project finance market and explores the main trends that can be expected for the coming years.
Presentation
Financieren van grote windprojecten
NWEA Winddag
14 June 2013
Barbara Zuiderwijk was invited by the Dutch Wind Energy Association, NWEA, to present a workshop on the financing of large windfarms at the Winddag 2013 (wind day). The Dutch government has set ambitious growth targets for both onshore as offshore wind. The workshop discussed the various sources of financing (debt and equity) to realise this ambition.
Presentation
Le coût, le prix et la valeur de l’éolien en mer
Saint Brévin
3 May 2013
Public debate presentation given in Saint Brévin (french).
Jérôme Guillet was invited by the Commision Nationale du Débat Public (national commission for public debates, a body tasked with organizing large scale consultation with the public for big infrastructure projects in France) to participate to a session in St Brévin about the economic impact of the proposed offshore wind farm near St Nazaire. His presentation (in French) is attached.
A full recording of the debate, including his intervention is available on the website of the commission
Click here and see “4eme réunion” box
Jérôme Guillet co-founded Green Giraffe in 2010 and was a Managing Director until 2021.
Presentation
An overview of the deals closed in 2012
GLGH Offshore Wind conference
20 February 2013
The presentation describes the transactions that took place in 2012 in offshore wind on both the debt and the equity side, and presents in more detail the Walney refinancing closed in December 2012
Jérôme Guillet co-founded Green Giraffe in 2010 and was a Managing Director until 2021.
News
Green Giraffe profile & interview in Offshore Wind Magazine
OFFSHORE WIND MAGAZINE
14 February 2013
Jérôme Guillet, Managing Director of Green Giraffe, was interviewed by Offshore Wind magazine in early 2013 and asked about Green Giraffe’s history and current work as well as his views on the banking market.
Offshore wind deals are happening and project developers that need money are getting it, but sometimes this is overshadowed by a cloud of negativity from banks and the utilities, which complain all too often that the project finance markets are broke or the regulatory frameworks insufficient.
“Jérôme Guillet, Managing Director of Green Giraffe, says: Sometimes I think the biggest obstacle for the development of the industry is the negative tone in some quarters. Whining should not be a business model!”
The gloomy public discourse, which is a form of negotiation by proxy between various stakeholders, can give the impression that offshore wind is not successful and that things are not being done to lower the cost of wind energy, which is not the case, he argues. There is somewhat of a false perception that the Euro crisis has brought everything to a halt but “deals are still being done!” he adds. In fact, the market is growing substantially with even more transactions taking place
Jérôme Guillet co-founded Green Giraffe in 2010 and was a Managing Director until 2021.
Article
Projectfinanciering en Bankability in de Offshore Windsector
WINDNIEUWS
1 February 2013
Jakob Bergvelt, from Green Giraffe’s Dutch team explains what makes an offshore wind project bankable and discusses how banks assess risks for such projects during construction and during the operational phase (in Dutch).
Om de ambitieuze, Europese duurzame energiedoelstellingen te halen zullen er in de nabije toekomst grootschalige duurzame energieprojecten moeten worden gerealiseerd. Projectfinanciering biedt een logische structuur om bij dat proces private ontwikkelaars te betrekken. Op deze wijze kunnen de noodzakelijke middelen worden aangeboord bij externe financiers zoals commerciële banken, exportkrediet verzekeraars en multi laterale financieringsorganen als de Europese investerings bank. Dit artikel geeft een beknopt overzicht van de belangrijkste criteria die dergelijke instellingen hanteren bij het beoordelen van investeringsmogelijkheden in duurzame energie, in het bijzonder offshore windenergie. Wat maakt vanuit ‘bankability’ perspectief een goed en realiseerbaar project?
News
Northwind – 2012 European offshore wind deal of the year
PROJECT FINANCE MAGAZINE
1 February 2013
The EUR 595 M Northwind financing, where Green Giraffe advised the borrower, closed in June 2012 and earned the « European offshore wind deal of the year » award from Euromoney/Project Finance Magazine.
The latest bout of weakness in European bank markets may be more fruitful than the last. This year’s winner in the offshore category, the 216MW Northwind offshore project, marries two recent trends – strong multilateral and export credit agency support, and the search for institutions that can replace constrained bank finance – to produce an influential and bakanble template.
Read the full article attached.
News
Walney refinancing closes
Press release
20 December 2012
The GBP 224 M refinancing of the stake held in the Walney project by PGGM and Ampère Equity Fund, where Green Giraffe advised the borrower, closed on 18 December 2012. Here’s the press release describing the transaction, as provided by the company at the time.
PGGM and Ampere Equity Fund, acting jointly through a dedicated investment vehicle, OPW, are pleased to announce that they have closed the refinancing of the purchase (completed in December 2010) of their 24.8% stake in the Walney offshore wind farm (situated about 14 km off the UK coast in the Irish Sea), the largest operating wind farm in the world.
A group of 4 commercial lenders: Lloyds Bank, the Royal Bank of Scotland plc, Santander, and Siemens Bank GmbH, together with the newly established UK Green Investment Bank plc (“GIB”), have provided between them facilities totaling GBP 224 M.
This financing will enable PGGM and Ampere Equity Fund to refinance on a non-recourse basis approximately 70% of the purchase price agreed with DONG Energy, the developer, operator and majority owner (with a 50.1% stake) of the project, that consists of 102 Siemens 3.6 MW turbines, for a total capacity of 367 MW. The first phase, Walney 1, was completed in July 2011, while the second, Walney 2, was commissioned in June 2012. SSE also has a 25.1% stake in the project alongside DONG Energy and OPW.
The project is expected to provide power equivalent to the consumption of around 340,000 UK households and to abate 480,000 tonnes of carbon emissions annually on current energy generation figures.
This financing marks the first loan by GIB to the UK offshore wind sector and is the first financing of a project minority stake in the commercial banking market.
News
Top 100 Power People (2012)
A WORD ABOUT WIND
17 December 2012
A Word About Wind’s attempt, in early 2013, at identifying the most influential people in the wind industry. Jérôme Guillet, Managing Director of Green Giraffe is included in the list.
32. Jérôme Guillet, MD, Green Giraffe
“Previously Head of Energy and Structured Finance at Dexia, Guillet heads a growing team at Green Giraffe. Guillet focuses on the negotiation and syndication of project finance energy transactions. An active and forthright speaker on the conference circuit, he is enterprising and decisive in his leadership”
Jérôme Guillet co-founded Green Giraffe in 2010 and was a Managing Director until 2021.
Article
Situation and prospects for Baltic Sea offshore wind energy
BALTIC TRANSPORT JOURNAL
1 December 2012
Jérôme Guillet, Managing Director of Green Giraffe describes the economic and regulatory framework for offshore wind in the various countries around the Baltic Sea, and discusses how the industry’s development may be funded.
At the end of 2012, 704 MW of offshore wind capacity is operational in the Baltic Sea, with another 448 MW under construction. There are sufficient wind resources to develop approximately 40 GW of offshore wind energy capacity in the area. However, such development of offshore wind farms in the Baltic Sea will largely depend on the regulatory frameworks offered in the various countries surrounding the sea.
The region’s states are at very different stages of economic development and have diff erent starting points as regards their current energy mix – and also diff erent views on how such mix should evolve. Some are still highly reliant on Russian oil and gas imports (for instance, in Poland, 94% of oil, 80% of gas and 70% of coal is imported from Russia) and look favourably at a home-grown resource. Some have access to plentiful and cheap hydro and are in no urgent need of more wind capacity (e.g. Sweden). Some may balk at supporting a sector whose costs of production are still higher than traditional power sources. On the other hand, EU Member States also need to fulfil the Union’s existing renewable energy targets.
Click here for the full article
Presentation
Recent trends in the financing of offshore wind farms
AWEA Offshore Wind Power
10 October 2012
The presentation describes how European offshore wind projects have been financed on a non-recourse basis, how banks look at the different risks, and the main commercial terms of such deals. It discusses how such precedents might apply in the USA.
News
The 30 most influential people in the wind energy industry
WINDPOWER MONTHLY
26 September 2012
Windpower Monthly’s second attempt, in late 2012, at identifying the most influential people in the wind industry. Jérôme Guillet, Managing Director of Green Giraffe is again included in the list.
WORLDWIDE: Wherever you look, there are signs that the wind industry is growing up from being a booming, emerging market to a mature, established industry. And our second annual survey of the top 30 industry leaders is no exception.
28. Jérôme Guillet
“A former Dexia head of energy with 15 years’ experience in project financing, Paris-based Guillet is behind many of Europe’s large-scale offshore-wind financing deals.”
Click here for the full article
Presentation
Financing UK offshore wind development
RUK offshore wind conference
13 July 2012
The presentation runs through the history of offshore wind project finance deals, describes the active players in the market, and focuses on the specific UK case.
News
CDC Infrastructure invests in solar energy through ForVEI
Press release
11 July 2012
CDC Infrastructure, advised by Green Giraffe, acquired a 24% stake in ForVEI, an investment company with a portfolio of 30 MW of operational solar projects in Italy. Here’s the press release describing the transaction, as provided by the company at the time.
CDC Infrastructure signed an agreement to acquire a 24% stake in ForVEI, the joint venture between VEI Capital and Luxco2 (which includes Quercus Renewable Energy and the recently announced JV between Adenium and Foresight). Total commitment from CDC Infrastructure amounts to €9 million. The transaction is subject to the approval by the European Commission. It is expected that completion will take place in August 2012.
The current portfolio of ForVEI comprises solar generation assets for a total installed power capacity of c. 30 MW in aggregate; the multi-shareholders vehicle is now targeting 100MW of Solar PV assets in Italy. ForVEI also recently signed a sale and purchase agreement for the acquisition of additional 8MW in the Lazio Region from Aleph Solaria; the closing of this acquisition, which remains subject to certain conditions precedent, is expected to take place by the end July 2012.
Following completion, the majority shareholder will remain VEI Capital with 52%, while CDC Infrastructure and Luxco 2 will retain a 24% stake each; the total equity committed in ForVEI by the various shareholders now stands at €37 million.
Article
Northwind reaches financial close
Press release
28 June 2012
The EUR 595 M Northwind financing, where Green Giraffe advised the borrower, closed on 28 June 2012. Here’s the press release describing the transaction, as provided by Green Giraffe at the time.
Green Giraffe was financial advisor to Northwind in the closing of a EUR 595 M long term financing for its 216 MW offshore wind project
Green Giraffe, the leading renewable energy financial advisory firm, is pleased to confirm that it acted as financial advisor to the project company in its successful closing of EUR 595 M long term facilities for the Northwind 216 MW offshore wind project off the Belgian coast.
This 15-year post construction transaction demonstrates that it is still possible to raise long term funding at attractive conditions for good projects in the offshore wind sector, and presents a number of firsts, (foran offshore wind farm) including:
the first tranche to be guaranteed by the export credit agency of Belgium (ONDD),
the first tranche to be guaranteed by the export credit agency of Norway (GIEK), and
the first tranche to be funded by PensionDanmark.
News
Northwind reaches financial close
Press release
28 June 2012
The EUR 595 M Northwind financing, where Green Giraffe advised the borrower, closed on 28 June 2012. Here’s the press release describing the transaction, as provided by the company at the time.
Financial close signals start of construction on 216mw Northwind offshore wind power plant
Belgium’s face of green energy is set to change as offshore wind energy gives a realistic answer to upcoming electricity shortage
Northwind NV announces the formal financial close with all key stakeholders and banks for their Northwind Offshore Wind power plant. This ends a series of intense negotiations and deliberations that constitutes one of the largest financial investment transactions in Belgium in recent years. The complex and difficult financial process started in November 2011, and now paves the way for the construction of the wind power plant on the Bank Zonder Naam (Lodewijkbank) off the coast of Oostende in Belgium to commence.
Northwind NV’s CEO Frank Coenen was also involved in the successful construction of the first phase of the Belwind Bligh Bank Offshore Wind project two years ago. He expressed his delight at the achievement of this milestone in the project plan: “In the middle of the financing phase for Belwind, Europe was going through an economical and financial crisis, making the financing of Belwind in 2009 very challenging. With these difficulties still fresh in their memories, investors are looking today for solid projects developed by a stable and trustworthy team, such as this one.”
Click here for the full press release
News
Offshore wind finance: riding the storm
WIND ENERGY UPDATE
25 May 2012
Pierre-Etienne Claveranne, from the Green Giraffe Paris team, was interviewed by Wind Energy Update in May 2012 and asked about his views on the availability of financing for offshore wind projects.
Wind Energy Update takes tips from some of the key lenders on what type of offshore wind project is considered bankable in tough economic times. Securing finance for offshore wind projects has always been a challenge and it’s one that has got harder in the downturn. So how can developers improve their chances of securing vital funds?
Offshore wind projects have traditionally proved more expensive than those undertaken onshore. According to Siemens Financial Services, offshore developments are 50 per cent more pricey than onshore, taking into account the need for new turbine foundations, grid connections, logistics and technology to deal with the harsher environments out to sea.
Throw in the continued global economic downturn, particularly in Europe, along with rising copper and steel prices, and toss in a good measure of uncertainty over Government subsidies, and securing investment for offshore projects becomes even more problematic.
“According to Pierre-Etienne Claveranne of specialist advisory boutique Green Giraffe , offshore wind finance “has never been easy and that’s still the case today.”
Click here for the full article
Presentation
The different options to finance offshore wind
awordaboutwind conference
3 May 2012
The presentation describes recent debt and equity transactions in offshore wind, and lists the different options available to fund investment in the sector.
Jérôme Guillet co-founded Green Giraffe in 2010 and was a Managing Director until 2021.
News
Green Giraffe Sees Funds Available for EU Offshore Wind
BLOOMBERG
20 April 2012
Jérôme Guillet, Managing Director of Green Giraffe, was interviewed by Bloomberg in April 2012 and discusses the availability of financing for offshore wind projects.
“Developers of offshore wind power stations in Europe will be able to find the “tens of billions of euros” they need to build the capacity planned even though banks are lending less, said Green Giraffe.”
“Available funds are growing alongside the industry,” Jerome Guillet, managing director of the Paris-based company that advises on wind projects, said by e-mail. “They will come from the traditional investors in the sectors such as utilities and from third parties” ranging from infrastructure to pension funds, he said.
Investors including Japanese trading house Marubeni Corp. (8002) and pension funds including PensionDanmark A/S are channeling money into European wind projects to tap long-term returns. Britain and Germany are leading construction of 35.5 gigawatts of offshore wind plants by 2020, requiring about 127 billion euros ($166 billion) of investment, according to Bloomberg New Energy (NENE) Finance. The facilities will provide 3.2 percent of the European Union’s electricity demand.
“Funding, whether debt finance, equity or other hybrid forms, is there for good projects and will continue to be as the industry grows,” he said. This is despite a “general perception” of financing shortages caused by the European debt crisis, he said. Third-party funding has actually outpaced industry growth in the past two years, he said.
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Jérôme Guillet co-founded Green Giraffe in 2010 and was a Managing Director until 2021.
News
Fears of an offshore wind project financing capacity crunch are unfounded
CLEAN ENERGY PIPELINE
12 April 2012
Jérôme Guillet, Managing Director of Green Giraffe, was interviewed by Cleantech Energy in April 2012 and discusses the availability of financing for offshore wind projects.
Fears raised by banks and project developers that commercial lenders have insufficient capacity to finance offshore wind farms are over-exaggerated, according to Jérôme Guillet, Managing Director of Green Giraffe, one of the leading advisory firms in the sector.
“In reality, more than 30 banks are already active in the offshore wind sector, which means that approximately Eur3 billion of debt financing is already available per year.”
“There is enough money for good projects,” he told Clean Energy pipeline. “The perception is that there is not because that is what banks and developers are saying all the time. Developers are often complaining about banks to hide the fact they haven’t done their homework. Banks are saying it to increase the costs of their services, to make it appear that they are rare and valuable.”
Guillet cited the completion last year of two billion-euro financing deals for offshore wind farms in Germany as examples of how there is sufficient debt for the right projects. Green Giraffe was an advisor on one of those deals, the Eur1.2 billion, 288 MW Meerwind project in the German North Sea. Financing agreements for the Lincs and Gunfleet Sands projects in the UK were also recently signed.
One of the sources of trepidation regarding the availability of project financing is a general perception that it is sourced from a small pool of commercial banks that are currently only prepared to participate in a couple offshore wind deals per year, and to commit a maximum of Eur 50 million per deal. Many bankers and developers have claimed this level of investment is insufficient to support the increasing number of projects vying for funding in today’s market.
According to Guillet, this outlook is misleading. In reality, more than 30 banks are already active in the offshore wind sector, which means that approximately Eur3 billion of debt financing is already available per year. Additionally, the claims ignore the contribution made by multilateral finance institutions such as the European Investment Bank (EIB) or German development bank KfW.
“Multilaterals can typically provide half the volume of offshore wind project finance, so suddenly we potentially have Eur6 billion per year,” he said. “That’s enough for deals in the market right now.”
The other main concern is that banks will not increase financing capacity to match the sharp rise in large offshore wind projects that is set to take place over the next decade as the UK Round 3 build-out kicks into high gear, alongside Germany’s expansion to replace its nuclear plants and additional capacity planned by France and the Benelux nations.
Guillet stated that this will likely not be a problem because banks will simply commit more resources to offshore wind as they become more comfortable with the sector, in reaction to demand from their clients.
“The fact that there are more deals will create more capacity,” he said. “More banks will come in. Those that are already doing offshore wind will have the (positive) precedents and the experience and want to do more, and those that are late will be aggressive and look to get a stake in the market.”
The nature of the European financial crisis may actually strengthen the financing environment for offshore wind. Guillet pointed out that the sector is far better placed to act as a safe haven for banks than it was during the 2008 crisis, partly because of its greater maturity, but also due to geographical factors and a shift in priority for large banking clients such as utilities, for whom offshore wind is the primary large-scale means of meeting renewable energy obligations.
“Ironically the crisis is helping, because offshore wind is mainly in Germany, the UK and Benelux, which have no sovereign debt problems. Banks want to finance renewable energy and would rather do offshore wind in these countries than solar in Greece,” said Guillet.
“That doesn’t mean deals are easy, but if you do it efficiently and with the proper due diligence, you will find financing on decent terms.”
Guillet sees equity providers also becoming increasingly comfortable with offshore wind, as reflected by Blackstone’s willingness to take on development and construction risk when investing in the North Sea offshore wind project Meerwind, and Danish utility DONG Energy’s ability to attract pension funds and other investors to its projects using innovative financing structures.
Green Giraffe is advising on six officially disclosed ongoing mandates for offshore wind projects. Guillet said the first of these that is likely to close is the 216 MW Northwind project in Belgium, which is currently in the market. The refinancing of PGGM and Ampere’s 25% stake in the 367 MW Walney wind farm in the UK could also go through this year, while the PNE Wind-developed Gode Wind II project in Germany could still close in 2012 if it secures a new equity investor swiftly enough.
Jérôme Guillet co-founded Green Giraffe in 2010 and was a Managing Director until 2021.
News
Consortium led by EDF and DONG wins 3 projects in French tender
Press release
6 April 2012
The consortium led by EDF Energies Nouvelles and DONG Energy has won the French offshore wind energy call for tenders for the Saint-Nazaire, Courseulles-sur-Mer and Fécamp projects. Green Giraffe advised the consortium on modeling tasks.
French offshore wind energy call for tenders
The European Consortium led by the EDF Group wins 3 projects
The European Consortium led by the EDF Group has won the French offshore wind energy call for tenders for the Saint-Nazaire, Courseulles-sur-Mer and Fécamp projects. These projects, corresponding up to 1,500 MW of new installed capacity, go hand in hand with an ambitious industrial plan which should create about 7,500 direct and indirect jobs, notably with the manufacturing of Alstom’s Haliade 150 wind turbine. The foundations are set for a new industry which will serve export markets.
Click here for the full press release describing the transaction as provided by EDF at the time
Article
Project Finance in Offshore wind – Differences in Risk Approach Between Banks and Utilities
WINDTECH INTERNATIONAL
7 March 2012
Jérôme Guillet, Managing Director of Green Giraffe, writes about how different types of investors in offshore wind projects perceive risks differently, use different routes to mitigate them, and thus tend to finance projects in different ways.
Differences in Risk Approach Between Banks and Utilities
The offshore wind farm sector is gaining momentum. New projects with a capacity of 866 MW were installed in 2011. However, a uniquely difficult combination of risks has brought about significantly different approaches to project management between banks and utilities. While utilities strive for a high degree of autonomy in terms of structuring the projects, banks call for a direct influence on and total transparency in the project contracts. Understanding these different perspectives will help both sides to cooperate in order to finance the massive pipeline of future projects
Jérôme Guillet co-founded Green Giraffe in 2010 and was a Managing Director until 2021.
Presentation
Show me the money. Project finance in offshore wind – what route will the market take?
EWEA Offshore Wind conference
28 November 2011
The presentation describes past non-recourse deals in offshore wind, recent trends and market standards, and suggests the way forward for the sector.
Article
Green Giraffe opens UK office
Press release
27 October 2011
Green Giraffe announced in September 2011 that it had created a new UK affiliate and opened a new office in the City of London. The office now has 3 full time employees.
Green Giraffe is pleased to announce that it has created a new UK affiliate, Green Giraffe UK Ltd and opened a new office in the City of London. The office will support the financial advisory activity of Green Giraffe in the growing British renewable energy market and especially in Green Giraffe’s core expertise area, advisory to the offshore wind sector.
Renewable energy project advisory
Green Giraffe has ample experience in continental Europe assisting developers in bringing their renewable energy projects to financial close. Green Giraffe’s close relationship with renewable energy investors, the UK and European project finance banking community, legal and technical advisors will be further boosted by the new London office, located in the heart of the city giving us the local presence required to better assist UK developers to successfully negotiate the financing for their projects: from modelling support, structuring the project and negotiating project contracts to arranging of equity and financing.
Specialised offshore wind competence
The UK is developing a large offshore wind program, with over 1.5 GW already operational and plans for 32 GW installed by 2030. To date, this market is dominated by utilities and projects have been mostly financed by them on a corporate basis. Nevertheless, the scale of the forthcoming investments, and the positive experience with non recourse construction financings in other European countries suggest that developers will increasingly look for third
party funding for their offshore wind farm projects. Green Giraffe has a uniquely successful presence in that market already, with direct involvement in two billion-euro non recourse financings in the past year (C-Power 2 in Belgium and Meerwind in Germany), and a client base including developers, companies in the supply chain and equity investors across several European countries and the USA. That track record has already been recognised in the UK context via an advisory mandate to refinance the purchase of a minority stake in the Walney offshore wind farm in the East Irish Sea and will now be deployed specifically in the UK market via a full time presence in London.
About Green Giraffe
Green Giraffe, with offices in Utrecht (the Netherlands), Paris (France), and now also London (UK) has a staff of 16 professionals with extensive experience in renewable energy finance and long track records in closing transactions in the non-recourse debt and equity markets. Green Giraffe was ranked n°1 financial advisor (by volume of closed deals) in the renewable energy sector in 2010 by Infrastructure Journal.
News
The 20 most influential people in wind power today
WINDPOWER MONTHLY
29 September 2011
Windpower Monthly’s first attempt, in late 2011, at identifying the most influential people in the wind industry. Jérôme Guillet, Managing Director of Green Giraffe is included in the list.
Choosing the movers and shakers in this global industry has been a mammoth task, but one that we feel we can be proud of. When we set out to find the most influential people in the industry, we knew we might ruffle a few feathers. In the end, having meticulously examined a long list of candidates, there was no shortage of people who left their mark thanks to an impressive array of skills. Today’s wind power leaders need to inspire, motivate, negotiate and collaborate. We are confident that all the faces on these pages have demonstrated this and much more.
19 Jérôme Guillet, MD, Green Giraffe
“A Frenchman with 15 years experience in project financing, Guillet is behind most large-scale offshore-wind financing deals.”
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Jérôme Guillet co-founded Green Giraffe in 2010 and was a Managing Director until 2021.
Article
Meerwind financing closes
Press release
5 August 2011
The EUR 822 M financing of project Meerwind, a 288 MW offshore wind farm in Germany owned by Blackstone and Windland, where Green Giraffe advised the borrower, closed on 5 August 2011. Here’s the press release describing the transaction, as provided by Green Giraffe at the time.
Green Giraffe successfully assists WindMW GmbH to bring the 288 MW offshore wind project “Meerwind” to financial close
“Green Giraffe consistently distinguished themselves and played a critical role throughout every step of the financing process (Blackstone)”
Nine months after the successful closing of the EUR 913 MW financing for the C-Power 325 MW offshore wind farm off the coast of Belgium, Green Giraffe is pleased to announce its latest achievement: the closing of the EUR 977 M financing for the “Meerwind” offshore wind project developed by Blackstone in Germany.
Ongoing mandates in the renewable energy sector in the UK, the US, Belgium, Germany and the Netherlands demonstrate the market’s growing confidence in Green Giraffe’s ability to get deals done and obtain financing for large scale projects on a competitive and timely basis and this transaction will further underpin such trust in our services.
News
Meerwind reaches financial close
Press release
5 August 2011
The EUR 822 M financing of project Meerwind, a 288 MW offshore wind farm in Germany owned by Blackstone and Windland, where Green Giraffe advised the borrower, closed on 5 August 2011. Here’s the press release describing the transaction, as provided by the company at the time.
Click here for the full press release
Article
Financing offshore wind
THE PRINCIPLES OF PROJECT FINANCE
24 June 2011
With investments in the offshore wind sector set to increase from a few hundred million euros to tens of billions per year, the question of where the money will come from has been at the forefront of industry preoccupations. This article examines how equity investors and potential lenders look at the sector and in what ways they can be expected to contribute.
The market to date
Industry growth so far has largely been achieved by utilities, alone or in small partnerships, financing and building their own projects and keeping them on their balance sheet.
There are, however, other possibilities. “Non-utility” projects, undertaken by independent power producers (IPPs), may call on non-recourse debt financing from banks, particularly during the construction phase. As of end 2010, just over 10% of operational capacity (and a similar percentage of capacity under construction) had benefitted from non-recourse debt financing, with a smaller percentage having been refinanced through debt after completion.
A number of interesting conclusions may be drawn at this point. One is that there are alternative sources to utilities for investment in offshore wind. Another is that banks show willingness to take construction risk (via debt), preferably, so far, in non-utility projects. Meanwhile, financial investors (via equity) tend rather to seek a stake in already operational projects. These conclusions also point to the most likely routes for utilities looking for external sources of funding:
recycling of project equity via the sale of (typically minority) stakes in operating projects; non-recourse financing of IPP projects prior to completion;
non-recourse refinancing of “utility” projects once they are operational.
Jérôme Guillet co-founded Green Giraffe in 2010 and was a Managing Director until 2021.
Presentation
Le financement des projets éoliens offshore
Rencontres internationales de Havre
24 June 2011
The presentation describes recent debt transactions in offshore wind, and discusses how banks analyze risks in the sector (in French)
Presentation
The financing of new energy infrastructure in the EU
Energy Policy Breakfast
23 March 2011
The presentation discusses the economics of wind vs gas-fired plants, and shows the influence of the regulatory framework on the investment preferences of developers.
News
C-power reaches financial close
Press release
25 November 2010
The EUR 913 M financing of project C-Power, a 325 MW offshore wind farm in Belgium owned by a consortium of Belgian and international investors, where Green Giraffe advised the borrower, closed on 25 November 2010. Here’s the press release describing the transaction.
C-Power EUR 1,289 M investment financing for the construction and operation of a 325 MW offshore wind farm
C-Power is pleased to announce that it has closed the financing of the second and third phases of the offshore wind farm on the Thornton Bank (located about 30 km in the North Sea off the Belgian coast). A group of 7 commercial lenders: KBC, Rabobank, Société Générale, KfW Ipex-Bank, Commerzbank, Dexia and ASN Bank together with export credit agencies Euler-Hermes of Germany and EKF of Denmark, and the European Investment Bank will provide between them long term facilities totalling EUR 869 M.
Click here for the full press release