The National Wealth Fund (NWF) has approved an around £62m loan for Orkney Islands Council’s six-turbine wind farm at Quanterness, supporting Scotland’s clean energy transition and the council’s long-term financial stability.
The 28.8MW project will export electricity to the national grid, providing green power for homes and businesses while generating a sustainable revenue stream for the council, the NWF said.
Development of the site in St Ola, between Kirkwall and Finstown, has been underway since 2019 and progression of the project into construction was unanimously backed by elected members earlier this year.
The wind farm is forecast to generate annual surpluses of more than £3m, delivering a cumulative benefit of £120m over 25 years to help fund and protect local public services.
Quanterness will connect to SSEN’s planned interconnector cable linking Orkney to the Scottish mainland.
A £144,000 annual community benefit scheme will fund local projects, with 60% of contributions directed to Kirkwall and St Ola Community Council and the remainder shared among 19 others across the islands, according to the NWF.
The funding organisation said the loan provides flexible, long-term financing that allows the council to deliver the project without further drawing on its Strategic Reserve Fund.
UK Chancellor of the Exchequer Rachel Reeves said: “We are investing in Britain’s renewal, and this loan will provide clean energy for homes and businesses to strengthen Scotland’s energy security for years to come.
“This is just one of billions of pounds worth of investments being announced today at our Regional Investment Summit, reversing decades of underinvestment and decline, slashing red tape to open up opportunities for businesses and kickstarting economic growth in every corner of the UK.”
National Wealth Fund managing director of local authority advisory and lending Lorna Pimlott said: “Not only will the Quanterness wind farm help to maximise Orkney’s natural resources to support key public services and projects for local people but this important project will allow the council and the community to contribute significantly to Scotland’s, and the broader UK’s, clean energy ambitions.
“Furthermore, delivery of the wind farm will help create employment and investment opportunities across Orkney and the wider region.”
Orkney Islands Council leader Heather Woodbridge said: “This is the latest stage in what is an immense project for our council, not only in its scale and ambition but also in its transformative impact on our community and the services we provide.
“Elected members unanimously backed the project at the start of this year – which is testament to the importance of the project in securing the future stability of public services in Orkney.
“The Quanterness project – as well as supporting the interconnector – will provide the council with much needed income to support vital services.
“In our discussions with our community they have been consistently clear that they hugely value the services we provide, and they want to protect them. In order to achieve that community aspiration this council must explore all opportunities available to us – and the Quanterness wind farm is a great example of that.”
In August, contracts were awarded to Nordex for the design, supply, transport, installation and commissioning of the turbines, along with a 25-year operations and maintenance agreement.
Construction is expected to begin in spring 2027.