Vineyard Wind secures $ 2.3 billion loan to start construction

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A crane towers over the first jacket installed to support a turbine for a wind farm in the waters of the Atlantic Ocean off Block Island (rear), Rhode Island, July 27, 2015. REUTERS / Brian Snyder / File Photo

Sept. 15 (Reuters) – Vineyard Wind, set to become America’s first large offshore wind farm, has closed a $ 2.3 billion loan and will begin construction in Massachusetts as early as this week, the developer said on Wednesday. of the project.

The senior debt financing allows the project, a joint venture between Avangrid Inc (AGR.N) and Copenhagen Infrastructure Partners, to mobilize its contractors and suppliers to begin work, the companies said.

This means that manufacturers like General Electric Co (GE.N), which is supplying the 62 turbines for the project, can start sourcing materials and hiring workers.

The U.S. government approved Vineyard Wind in May, billing it as the inauguration of a new domestic industry that will help eliminate emissions from the electricity sector, a key pillar of President Joe Biden’s climate change agenda.

“Construction will begin tomorrow” on a substation in Barnstable, Mass., Where submarine cables will connect to the onshore power grid, Lars Pedersen, general manager of Vineyard Wind, said on a conference call with journalists.

Work at sea will begin next year and the project is expected to start providing electricity in 2023.

The project is expected to cost around $ 3 billion in total, and its owners expect to raise equity capital later that would qualify for a federal clean energy tax credit, Pedersen said.

Vineyard Wind will be located 15 miles off Martha’s Vineyard and is expected to generate enough electricity to power 400,000 homes in New England.

Nine banks participated in the financing of $ 2.3 billion. They include Bank of America, JP Morgan, BBVA, NatWest, Crédit Agricole, Natixis, BNP Paribas and MUFG Bank. The company was advised by Santander, who also invested in the project.

Reporting by Nichola Groom; Editing by David Gregorio and Marguerita Choy

Our Standards: Thomson Reuters Trust Principles.


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