Japanese build £1bn wind farm stake

Kansai Electric Power and J-power back Triton Knoll project as Asian appetite for partnerships grows

TWO Japanese energy companies are to help finance a giant offshore wind farm after agreeing to pay almost £1bn for a stake in Innogy’s Triton Knoll project.

The German renewables company behind the £2bn wind farm off the coast of Lincolnshire announced that it would sell 41pc of the project to Japan’s Electric Power Development, better known as J-power, and Kansai Electric Power.

The two companies will take 25pc and 16pc of the project respectively in the first major move by Japanese energy companies into the UK’S booming wind power market.

The Triton Knoll project was awarded a contract from the UK Government to guarantee its developers a revenue stream of £74.75 per megawatt hour of electricity produced.

Offshore construction is expected to start at the end of next year. By the beginning of 2021, the wind farm will be able to generate enough clean energy to power 800,000 homes.

Adrian Scholtz, a partner at KPMG, said that the deal demonstrated the continued appetite from Asia for project partnerships with the major European energy companies. China Resources Power agreed at the end of last year to buy 30pc of the Norwegianled Dudgeon wind farm off the coast of Norfolk for £555m.

Earlier this year, Malaysian-owned Tenaga Wind Ventures acquired a controlling stake in two UK onshore wind operators for £77.4m.

J-power, already a leader in offshore wind in Japan, said it was actively building a pipeline of new projects outside its domestic market.

Kansai Electric referred to the deal as an “important milestone” in its move into the European renewables market, which it expects to develop “drastically” in the years ahead.

“Europe’s major energy companies are seen by both Asian strategic and financial investors as valuable partners at the cutting edge of offshore wind technology; and can meaningfully assist in opening up the enormous market opportunity in Asia,” Mr Scholtz said.

“We fully expect this trend to continue, with the UK remaining a very attractive market for Asian investors, as they look to build globally integrated businesses,” he added.