An agreement between the UK Green Investment Bank (GIB) and Abu Dhabi energy company, Masdar, could further boost the UK offshore wind industry. Both parties have previously invested in UK offshore wind assets and have now committed to consider investing jointly in further "green infrastructure projects".
A memorandum of understanding (MoU) will be signed tomorrow, by Masdar chief executive, Sultan Ahmed Al Jaber, and GIB chief executive, Shaun Kingsbury. The MoU paves the way for the two parties to work together over the coming seven years, by introducing "potential investment opportunities to one another and other potential investors".
The deal is part of the GIB’s remit to do more than simply invest its own funds in UK low-carbon infrastructure. It is also expected to lever investment from other sources.
Sultan Ahmed Al Jaber referred specifically to offshore wind in comments about the MoU. "Masdar is pleased to be contributing to the UK’s renewable energy portfolio through the London Array and we are actively engaged in exploring new investment opportunities in the UK offshore wind and clean technology sectors".
In 2008, Masdar acquired 20% of London Array, from E.ON. London Array 1 came fully online earlier this month. At 630MW, it is the world’s largest operational offshore wind farm. A consent application for the 240MW London Array 2 was submitted last year.
Meanwhile, offshore wind is a priority investment area for the GIB. Thus far, it has spent £57.5m in buying just under a quarter share of the 90MW Rhyl Flats offshore wind farm. It has also provided about £45m to a consortium of banks responsible for part of the Walney project’s debt finance.
The GIB-Masdar deal is precisely the type of agreement sought by the UK Government. It is eager to demonstrate its success in attracting foreign finance for its infrastructure upgrade programme, which was recently criticised by a group of politicians. Commenting on the MoU, junior energy and climate change minister, Greg Barker, said: "This alliance is a …huge vote of confidence in the UK clean energy sector".