Germany

Germany

Mitsubishi invests €575m in German cable projects

New rules on liability reap financial reward

Germany's new rules designed to remove obstacles standing in the way of rapid development of offshore wind capacity are proving successful, with Mitsubishi concluding a deal to acquire 49% stakes in two German North Sea offshore cable projects and confirming plans to invest in two more.

Financial close has been reached between Mitsubishi and German North Sea transmission system operator (TSO), TenneT, which sees the Japanese industrial giant invest €240m for a 49% stake in the 400MW BorWin1 and 800MW Borwin2 export cable projects.

Until now, the cable projects have been wholly owned by under-capitalised, TenneT, which has been under intense pressure to speed up construction. The deal with Mitsubishi was announced in February 2012, but could not be finalised until the German government made changes to rules governing liability in the event of project delay and/or cable failure. The crucial new rules entered into force at the beginning of the year.

Mitsubishi also plans to spend a further €336m for 49% stakes in two other cable projects, 690MW HelWin2 and 900MW DolWin2.

Once completed, the four cable projects will be capable of transmitting 2.8GW of offshore wind-generated electricity to shore. This represents close to one-third of Germany's 10GW by 2020 offshore wind target.

Commenting, TenneT chief executive, Mel Kroon, emphasised that last year's successful collaboration between the offshore wind industry and legislators underlined that "Germany is attractive for institutional investors".

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