Copenhagen Infrastructure Partners (CIP) has completed the refinancing of its interest in two biomass power plants in the UK on behalf of the fund Copenhagen Infrastructure I K/S (CI I). The fund has provided equity, preferred equity and senior debt for the development and construction of the two biomass power plants. The plants have now come into operation and senior debt has been sourced from third parties to refinance CI I’s initial investment. The fund retains its ownership interest in the two operating entities.
The GBP 250m senior debt financing is delivered by a combination of banks and institutional investors thus confirming the commercial viability and attractiveness of this renewable asset class to the broader debt markets. Royal Bank of Scotland, Investec, Aviva Investors, and one other major institutional investor together acted as lenders on the refinancing.
“We are focused on investing in green field energy projects and the completion and subsequent refinancing of these two first biomass plants in our portfolio is an important milestone for us. We are delighted to have received the support of the broader debt markets. We are grateful to our current lenders that engaged in this transaction and we are committed to continue building strong relationships with them and will continue to explore debt capital market opportunities.” said Rune Bro Róin, Senior Partner at Copenhagen Infrastructure Partners K/S.
Sarah Wall, Senior Portfolio Manager, Alternative Income Solutions, Aviva Investors said: “We were very pleased to work with CIP on this investment, which provides a good match for the strong demand we see from pension funds for assets that deliver reliable, long-dated cash flows with appropriate risk-adjusted returns. We were able to offer a bespoke debt structure to finance the project, helping CIP tailor the financing structure to their needs.”
Together with CI I’s consortium partner BWSC, the two plants have both been taken from FID to commissioning ahead of schedule. The plants utilise proven straw-burning technology with construction risk now fully discharged and with stable operation and capacity slightly above initial expectations.
The plants generate clean green energy and are able to operate with variable fuel mixes co-firing straw with e.g. rape, miscanthus, woodchips. The two plants combined produce energy equivalent to the consumption of 152,800 households, saving over 550 thousand tons of CO2 a year.
Briggs REP is a 40MW straw fired biomass plant situated in Lincolnshire in UK and was acquired by BPCL in 2013. After the takeover Brigg was successfully completed and commenced operations in January 2016 – three months ahead of schedule. Brigg was awarded 1.5 ROCs.
Snetterton REP is a 44MW straw fired biomass plant situated in East Anglia in UK and was acquired by BPCL in 2014. Snetterton reached completion in April 2017 – one month ahead of schedule. Snetterton is accredited for 1.4 ROCs.
About Copenhagen Infrastructure Partners
Copenhagen Infrastructure Partners P/S (CIP) is a fund management company focused on energy infrastructure including offshore wind, onshore wind, solar PV, biomass and energy-from-waste, transmission and distribution, and other energy assets like reserve capacity and storage. CIP has approximately 110 employees and offices in Copenhagen, Taipei, New York, Tokyo, Utrecht, and London.
CIP manages six funds and has more than EUR 8 bn under management. CI I, CI A I and CI A II have PensionDanmark as founding- and sole investor. CI II has 19 Danish and international institutional investors and CI III has 42 institutional investors from the Nordics, Continental Europe, the UK, Israel, Asia, Australia, and multi-lateral organizations e.g. EIB. CI NMF I has 15 investors from the Nordics and Continental Europe.
CIP was founded in 2012 by senior executives from the energy industry in cooperation with Pension Denmark.