EIB to provide funding for offshore wind projects

The European Investment Bank (EIB) will lend up to £300 million to help connect offshore wind parks to the UK’s electric power grids, as the country aims to reduce carbon gas emissions nationwide. The bank loans are to be given to 13 bidders who will own and operate the power cables used in wind farms built by European energy regulators, including the UK’s Scottish and Southern Energy (SSE).

Energy Minister Phil Hunt said that the money would help energy projects, which are currently under construction, to quickly and cheaply get their cables underwater and feed into the power system. The UK government has promised to utilize a 33GW offshore wind power by 2020.

The six wind farms have a combined 1.6-gigawatt capacity. The offshore projects include the SSE’s 504MW Greater Gabbard in the North Sea, a joint venture with Germany’s second biggest power company, RWE Innogy.

Norway’s Statkraft AS and StatoilHydro ASA’s 315MW Sheringham Shoal wind park, located at the Norfolk coast, is also eligible for the funding.

The EIB will also consider a fund for Offshore Transmission, Macquarie Capital Group, Balfour Beatty and other companies that will manage the wind farm cables. Richard Willis, Spokesman of EIB, said that the fund agreement will be made next month and the loan contracts will be awarded by April 2010.

The planned power links to be constructed in six wind farms are estimated to cost £1 billion. Mark Wiltsher, Spokesman of Ofgem, informed that the wind parks will be providing power within the next two years.