PGGM steps up backing of offshore wind infrastructure with direct stake in UK farm

PGGM, the €98bn Dutch pension fund manager giant, has stepped up its backing for wind investment by investing alongside a fund to buy a 24.8% stake for £16m (€18.9m) in the 367MW Walney offshore wind farm in the UK, which is under construction.
PGGM is taking the wind project stake alongside the Ampère Equity Fund, a €320m sustainable energy infrastructure fund in which it and Dutch pension fund management peer APG already invest €100m apiece. The Ampère fund is managed by Triodos Investment Management and takes stakes in land- and sea-based wind parks and biomass power stations in various western European countries. PGGM and Ampère are buying the stake from DONG Energy, the Danish power group, which will retain a 50.1% stake. Alongside the initial investment, PGGM/Ampère wil also pay a pro rata share of the construction costs. The purchase price excludes payment for the project’s transmission assets, which are to be owned by a separate transmission operator to be decided by the UK regulator. Scottish and Southern Energy (SSE) bought a 25.1% stake in the Walney project in December 2009.DONG Energy is involved in building three new major UK offshore wind farms, including what will be the world’s largest offshore wind farm, London Array (630 MW), due to enter into operation in 2012. The other two wind farms, Walney (367 MW) and Lincs (270 MW) are scheduled for completion in 2011. A spokesman for PGGM said the fund had added to the Walney wind investment with the Ampère Equity Fund because the size of the stake was above the usual wind commitments made by Ampère. Henk Huizing, head of infrastructure investments at PGGM, said: “This direct investment in clean energy is aligned with the ESG criteria in the investment policy for our clients. It highlights our infrastructure change in strategy to shift our focus from fund investments to entering into partnerships with strategic players for direct investments. Our infrastructure investments are made through the PGGM Infrastructure Fund 2010-2011 containing commitments for EUR 1.25 billion and with current investments in social infrastructure, transportation, communication and energy.”