Deepwater Hits Financial Close For Block Island Wind Farm, Expects Summer Construction

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Deepwater Hits Financial Close For Block Island Wind Farm, Expects Summer Construction In a first for the nascent U.S. offshore wind industry, Providence, R.I.-based Deepwater Wind has reached financial close for the 30 MW Block Island Wind Farm.

Reaching financial close on more than $290 million in project financing, the project developer has secured all debt and equity funding needed to construct and operate the demonstration project, located off the coast of Block Island, R.I.

The lead arrangers were Societe Generale of Paris and KeyBank National Association of Cleveland. In addition, Societe Generale also acted as bookrunner, administrative agent and financial advisor for debt raise.

‘We're ecstatic to reach financial close and thrilled to be partners with Societe Generale and KeyBank for this groundbreaking clean energy project,’ says Jeffrey Grybowski, CEO at Deepwater Wind. ‘We're full-speed ahead and moving ever closer to 'steel in the water.'’

The financing from Societe Generale and KeyBank is in addition to more than $70 million in equity funding already provided by a subsidiary of D.E. Shaw Group, the owners of Deepwater Wind.

According to Deepwater, work on the project has already started.

Alstom will supply five Haliade 150 6 MW offshore wind turbines for the project. In fact, the turbine provider has already completed the fabrication in Denmark for all 15 blades that will power the project. The so-called ‘steel in the water’ is planned for this summer, when all five foundations are scheduled for installation off the Block Island coast. The project will be in-service in the fourth quarter of 2016.

The announcement represents a much-needed shot in the arm for the emerging offshore wind sector, which is still reeling from the termination of two Cape Wind power contracts in early January. Some industry watchers feared that the damaging Cape Wind news would negatively impact the U.S. offshore wind segment by association.

Nonetheless, ‘Financial close on Block Island is momentous for the U.S. offshore industry, particularly after the collapse of Cape Wind at the end of 2014,’ says Luke Lewandowski, research manager at MAKE Consulting. ‘The achievement positions Block Island to be the first U.S. offshore wind project, and it demonstrates that offshore wind in the U.S. can be financed – a critical milestone as three DOE pilot projects work toward completion.’

Caption: The Block Island Wind Farm will feature five Alstom 6 MW Haliade wind turbines, shown here powered phase two of the Belwind Offshore Wind Farm, located off the coast of Belgium. Photo courtesy of Alstom.

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