Copenhagen Infrastructure Partners (CIP) has closed a non-recourse long-term project financing credit facility for the investment in the Monegros portfolio of 12 onshore wind farms with a total installed capacity of 487 MW located in Aragon, Spain. Monegros is part of Copenhagen Infrastructure III K/S (CI-III), a EUR 3.5bn energy infrastructure fund managed by CIP.
Six leading Spanish and European banks, comprising ABN AMRO, Bankia, Bankinter, BBVA, Sabadell and Unicredit, have committed around EUR 380m of non-recourse long-term debt financing available for drawdown upon the wind farms commencing commercial operations. Construction will continue to be funded solely with capital provided by CI-III. The financing has been independently validated as a Green Loan under the Green Loan Principles 2018.
“The closing of the Green Loan financing of Monegros on attractive terms marks another important milestone for our Monegros investment. This project matches our strategic focus on large scale renewable energy investments that can generate attractive and stable long-term returns for our investors. It is one of the largest market parity renewable energy investments made in Europe to date, demonstrating CIP’s ability to identify and execute projects that will contribute meaningfully towards Europe’s green transition. We would like to thank the lenders and the advisors involved for successfully completing this transaction, despite a challenging market environment” says Christian Skakkebæk, Senior Partner at CIP.
BBVA acted as structuring bank and green loan coordinator for the debt financing. Uría Menéndez acted as legal advisor to the lenders and Watson Farley & Williams as legal advisor to the sponsor. Aurora Energy Research acted as market consultant, DNV GL as technical advisor and Marsh as insurance advisor. PricewaterhouseCoopers provided financial model development, support and audit. On PPA, CIP was advised by Our New Energy (commercial) and Watson Farley & Williams (legal). Chatham Financial acted as hedging advisor to the sponsor.
The construction phase is progressing well and, despite Covid-19 causing a challenging environment for construction activities in Spain, the wind farms remain on time and on budget. First power has been achieved and the wind farms will gradually reach commercial operations date (COD) over the next approximately 12 months. When in full operation, the portfolio is expected to generate approximately 1.5 TWh of renewable power annually, sufficient to meet the demand of approx. 430,000 Spanish households.
The power generated by the Monegros wind farms will be sold under power purchase agreements (PPAs) that will pay a fixed price for each generated MWh. The PPAs, entered into earlier this year, will cover the majority of output generated by the wind farms for 10 years from COD. In total, it is expected that the Monegros wind farms will sell approx. 12 TWh of renewable power under the PPA, making it the largest renewable power purchase agreement signed to date in Europe.
CI-III acquired the Monegros portfolio in development phase through two transactions in 2019 from Forestalia Renovables, the experienced Spanish developer that has continued to develop the portfolio in cooperation with CIP. The portfolio, comprising 12 wind farms in close proximity to each other, has 129 GE 3.8-130 wind turbines supplied and installed by GE Renewable Energy. GE Renewable Energy will also provide operational and maintenance services for the turbines under a long-term service agreement. The balance of plant (BoP) works is being executed by leading Spanish contractors Copsa, Elecnor and GES. Construction management is provided by Blue Power Partners and asset management will be provided by PeakWind. FIH Partners acted as financial advisor to CIP on the acquisition of the Monegros portfolio.
About the transaction
ABN AMRO Bank NV, Banco Bilbao Vizcaya Argentaria S.A., Banco de Sabadell S.A., Bankia S.A., Bankinter S.A. and UniCredit Bank AG, all as Mandated Lead Arrangers, have agreed to provide CI III Monegros Energy HoldCo SLU and its subsidiaries a non-recourse long-term project financing credit facility of around EUR 380m to refinance the costs incurred in the development and construction of each wind farm from the Monegros portfolio.
About Copenhagen Infrastructure Partners
Copenhagen Infrastructure Partners P/S is a Danish fund management company specialized in investing in the energy infrastructure sector. The company was established in 2012 and is today a global leader, market pioneer and the largest financial sponsor with a dedicated energy infrastructure focus. CIP has approximately 110 employees and offices in Copenhagen, New York, London, Utrecht and Tokyo.
CIP has seven funds with around EUR 10bn under management. To date, the funds have made 20 investments in large scale energy infrastructure assets totaling almost 8GW in power generation capacity across the US, the UK, Germany, Spain, and Taiwan. In addition, more than 15 greenfield energy infrastructure projects are in process to reach final investment decision and start of construction within the next 2-3 years. Investors in the funds include several blue-chip institutional investors from the Nordics, Continental Europe, the UK, Israel, Taiwan, Korea, Australia, and multi-lateral organizations. The investors in CIP’s funds comprise mainly pension funds, life insurance companies and large family offices.