Greater Gabbard OFTO has received a licence from Ofgem to own and operate the £317m transmission link to the Greater Gabbard wind farm.
Following a competitive tender under the OFTO regime, Ofgem has selected Greater Gabbard OFTO to take over ownership of the link from Greater Gabbard Offshore Winds.
SSE renewables and RWE npower renewable equally own the Greater Gabbard Offshore Winds.
Greater Gabbard OFTO is owned by a consortium including Balfour Beatty Investments, Equitix and AMP Capital Investors.
The wind farm with 140 wind turbines, has the capacity to produce about 500 MW that can supply clean energy for around 530,000 homes.
Ofgem noted that the project is the first one to be funded through capital markets and only the second in Europe to make use of the EIB Project Bond Credit Enhancement (PBCE) product.
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By GlobalDataPBCE is designed to reduce the investment risk, and enable infrastructure projects to attract additional private finance from institutional investors such as insurance companies and pensions funds.
Ofgem E-Serve managing director Robert Hull said the tender has enabled the first project in the UK to utilise the EIB’s PBCE product.
"This deal provides further evidence of the benefits to consumers of opening up the offshore transmission market to competition, and ensuring we get best value from innovation in the funding markets," Hull added.
European Investment Bank UK vice president Jonathan Taylor said the public bond issue for the Greater Gabbard OFTO represents the first use of the joint EIB-European Commission Project Bond Initiative in the UK.
"This adds a new dimension to infrastructure finance in the UK energy transmission sector by attracting greater participation by institutional investors in an essential part of the offshore wind value chain," Taylor added.
