Renewables infrastructure fund Greencoat UK Wind has agreed to buy the Douglas West wind project in Scotland from Blue Energy.
The sale of the 45MW facility, near Lanark, is expected to complete in the first quarter of 2019, subject to finalisation of construction, operation and maintenance contracts.
Construction of the subsidy-free project will start in 2019 with commercial operations expected to start in July 2021.
Blue Energy and Natural Power will provide owner’s engineer and construction management services. All construction contracts will be fixed price and include appropriate warranties and liquidated damages.
Acquisition and construction costs will total £45 million over the period January 2019 to July 2021, which is expected to be funded through reinvestment of Greencoat UK Wind’s excess cash flow.
The investor’s acquisition of Douglas West, which follows its recent purchase of the Tom nan Clach Contracts for Difference project, will account for less than 3% of the portfolio by value, once operational and assuming no further acquisitions.
Greencoat UK Wind chairman Tim Ingram said: “We are pleased to have reached agreement to acquire Douglas West.
“Once operational, Douglas West will sit alongside our existing 32 renewables obligation certificate investments and, with Tom nan Clach also incorporated, will increase our generating capacity to 910MW as part of our balanced portfolio.”
Greencoat Capital owns the Greencoat UK Wind fund. Greencoat Capital’s Stephen Lilley said: “During 2018 we have continued to build our portfolio with investments and commitments totalling over £500 million, of which approximately 70% are in ROC accredited wind farms.
“Although we are starting to see attractive CFD and subsidy-free investment opportunities, we expect the majority of future investments will continue to be made from the £50 bn pool of UK wind farms accredited under the ROC regime.”