FINANCE: Small players – big projects

“It is almost like winning the lottery,” Meewind Director Willem Smelik says when reflecting on how a group of small investors have managed to participate in three major offshore wind farm projects. “We are now investing in a third wind farm ‘Nobelwind’ and raising funding of €25 million a year!”

Meewind is an umbrella investment fund, which specialises in offshore wind and other renewables projects. “Meewind now has 6,500 participants, has raised funds of over €87 million and we are seeing high returns on their investment.”

The organisation was established in 2007 and just two years later it took a participation in Belwind, which is located at Bligh Bank, 46 kilometres from the Belgian port of Zeebrugge. Belwind has 55 Vestas turbines producing 165MW. The first phase was finished in December 2010. “We have been very lucky with Belwind, I still can’t believe it. We have managed to achieve a large, industrial project with a group of small investors.”

A consortium of Belgian retail giant, the Colruyt Group and the Flemish investment fund PMV is the majority shareholder of Parkwind, the developer of Northwind and Nobelwind, with a 41% stake, while Japan’s Sumitomo Corporation has 39% and Meewind 19.9%.

Willem comments: “Belwind has been in operation for more than four years now with the availability of turbines standing at more than 95%. We originally thought that we would manage 92% availability for five years but currently, availability is 95% for the next 15 years, which is fantastic and much better than we ever expected.” Since 2010, Belwind has delivered electricity to some 170,000 households.

Following Belwind, Meewind carried out its second major investment in Northwind, which lies on the border of the Belwind concession some 40 kilometres from the coast of Zeebrugge. Meewind has invested €5.8 million in Northwind.

A second phase of the Belwind/ Bligh Bank project was always planned and is a totally separate concession. Meewind is currently raising funds to realise Nobelwind, the second phase of the project, which will also have 165MW.

Nobelwind

Because the two phases were always planned many elements of the new wind farm have already been completed and with all of the contracts signed, construction is planned to start in spring next year. When Northwind was built the developers already laid the cable for Nobelwind for example.

The new wind farm will comprise 50 3.3MW Vestas turbines. The export cable, by Nexans, will connect Nobelwind’s offshore high voltage substation (OHVS) to the existing 220kV Northwind OHVS. Bladt Industries AS and Semco Maritime are responsible for the substation and Ramboll for the foundations. Marine contracting will be coordinated by Jan De Nul, while Belwind was carried out by Van Oord.

DeepOcean Group is installing Prysmian array cabling. Some 14 kilometres of export cable goes between Nobelwind and Northwind and 43 kilometres from Northwind to the shore. Meewind is seeking financial close of Nobelwind between 15 October and 10 November. The fund’s total investment represents €37 million. “With Nobelwind we wanted to create a special purpose vehicle separate from Belwind to isolate the development risks.”

Mr Smelik highlights some of the major changes that have taken place since Belwind, which involve both construction changes and in the shareholding structure when, in October 2014, Sumitomo Corporation bought a part of the shares in Parkwind.

“While on the construction side, the major changes from Belwind are that the export cable is 220kV, increasing from 170kV, and that there are now two offshore high voltage stations.”

“And of course we – as Parkwind/ Meewind – have much more experience now. Our technical director is now working on his seventh wind farm, as are many of the team. We must have the most experienced team in the sector and this is combined with one of the richest investor groups.”

Experience made the company decide to install the OHVS right at the beginning of the construction process in spring 2016 “We expect the first turbines to produce electricity in October. It is quite expensive to install the station immediately but this is deemed the best way to get all the turbines producing at the same time.

“It is also important that we have all Vestas turbines at the three wind farms. This gives a lot of advantages for operations and maintenance. Additionally, the biggest risk with any wind farm is always the cable and that is already installed.”

There is also good news for the investors, which typically invest an average of €12,000. They can still expect interest of around 7 to 10 per cent a year and they will see a cash return on their investment much sooner than they did with Belwind, he points out.

Waiting for a homeplay

And with Nobelwind well on track in Belgium, Meewind is turning its attention to developments in the Netherlands. Certainly, there is a sense of frustration that this Dutch organisation has not yet been able to participate in a domestic wind farm, as projects have been slow to come to fruition.

Mr Smelik emphasises: “The next challenge is in Dutch waters. The government has the ambition to have 4,450MW by 2023 and I hope we can join one of developers there. They are also interested in citizen participation, so I hope that the fact that more than 6,000 people want to participate should be taken into account in any tendering process. However, at this stage I think Nobelwind will complete sooner than Gemini in the Netherlands.”

In the meantime the focus is on Nobelwind. “There is a lot of interest – the fund is growing by €25 million a year. We have seen some €5 million raised in just the last month. Looking ahead, I am certainly optimistic with the project expected to complete mid 2017”

Helen Hill