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AMP Capital, as part of a consortium with Balfour Beatty and Equitix, has been granted a £317 million (A$570 million) transmission licence as part of the Greater Gabbard offshore transmission owner (OFTO) project. Each organisation within the consortium holds a one-third share of the project.
Greater Gabbard is AMP Capital’s first offshore transmission investment as part of UK energy regulator Ofgem’s OFTO tender regime. AMP Capital will jointly own and operate the OFTO assets under a longterm licence granted by Ofgem with a 20-year revenue entitlement.
The Greater Gabbard OFTO is the high voltage transmission system that connects the 504MW Greater Gabbard Wind Farm, located off the coast of Suffolk, to the onshore transmission grid. Greater Gabbard will generate enough clean electricity for 530,000 homes each year. The OFTO assets include three substations – two offshore and one onshore – and more than 150km of sub-marine cable infrastructure.
AMP Capital Head of Infrastructure for Europe and the Americas Boe Pahari said: “Renewable energy is an important sector for us because of its growth potential. I’m thrilled the consortium has been granted this licence for the Greater Gabbard Wind Farm as it marks AMP Capital’s first offshore transmission investment.”
Greater Gabbard is also the first OFTO project to raise debt financing from public bond markets and the first UK project to make use of the European Investment Bank Project Bond Credit Enhancement (EIB PCBE) product, which is designed to enable infrastructure projects such as this one to attract private finance from institutional investors. It reduces investment risk, enabling the project to attract cheaper finance, which ultimately reduces cost for consumers.
“This project is in line with our investment strategy which includes holding core, high-quality assets within our infrastructure business in order to ensure sustainable and long-term value for our investors,” added Mr Pahari. “It follows our agreement to acquire a significant stake in Powerco, New Zealand’s second largest electricity and gas distributor, which reached its financial close this week.”