UK Banks Commit to Lending £1.4 Billion for Onshore Wind Farms

Strategic Insights -

The UK government announced that several major banks, including the Royal Bank of Scotland PLC, BNP Paribas Fortis SA, Lloyds Banking Group PLC, and the European Investment Bank, have agreed to lend £1.4 billion over the next three years to developers of onshore wind farms in the UK. This increase of 40% from the initial £1 billion commitment will support the government's goal of achieving 15% of energy from renewable sources by 2020. The funds will be available to eligible onshore wind projects with a total project cost of between £20 million and £100 million.

Key Takeaways:

  • The UK government has set a target of achieving 15% of energy from renewable sources by 2020, which could require over 40% of electricity to come from renewable sources like wind, solar, wave, tidal, and hydroelectric power.
  • The UK banks will start offering new loans to eligible onshore wind farms immediately, with developers having the opportunity to start brokering deals at a forum in London.
  • The loans will be available to eligible onshore wind projects with a total project cost of between £20 million and £100 million.
  • The new funds will help stimulate the market and provide support for smaller and medium-sized projects affected by the recent turbulence in the financial markets.
  • Novera Energy PLC has recently secured funding for its 22-megawatt Glenkerie wind farm in Scotland from Lloyds and BNP Paribas Fortis.
  • The European Investment Bank's Vice-President, Simon Brooks, stated that targeted support will facilitate rapid and sustained investment in the industry and promote a low-carbon economy.

Statistics:

  • The UK government aims to achieve 15% of energy from renewable sources by 2020.
  • Renewable energy sources currently provide 2.25% of the UK's total energy consumption and 5.3% of its electricity generation.
  • The UK needs a six-fold increase in renewables by 2020 to hit its target.
  • In 2008, the UK received £336 million in project finance for onshore wind, which declined to £54 million between 2007 and 2009.
  • Only a fifth of the planned 3,812 MW of new onshore wind projects have secured financing and begun construction.

Sources:

  • "UK banks commit to lend GBP1.4bn for onshore wind farms." Euclid Infotech Pvt. Ltd. (Provided by Syndigate.info an Albawaba.com company)