Start next year for £725m Centrica wind farm

Construction will start next year on Centrica's £725m Lincs offshore wind farm after the project wrapped-up a funding deal today.

Lincs will be situated eight kilometres off the coast of Skegness next to Centrica’s existing wind farm developments at Lynn and Inner Dowsing and will comprise of 75 3.6MW Siemens turbines.

Investment in the project is expected to total approximately £725m and the wind farm should start generating power towards the end of 2012.

Under current UK Government proposals, Lincs will attract two Renewable Obligation Certificates (ROCs) for every megawatt hour (MWh) produced, following the UK Government’s decision in April to enhance the level of support provided for new offshore wind projects.

Centrica also announced that it has agreed the sale of a 50% equity stake in its Lynn, Inner Dowsing and Glens of Foudland wind farms to the US-based investment management company TCW for £84m, and entered into agreements to raise approximately £340m of non-recourse project finance facilities from a consortium of banks for these assets.

The transactions value the wind farms at approximately £460m. Profit on disposal of this 50% equity stake will be around £50m.

Sam Laidlaw, Chief Executive of Centrica, said: "Our decision to build Lincs illustrates our continued commitment to develop renewable generation and confirms our position as one of the UK leaders in green energy. The Government’s enhanced financial framework for offshore wind has been fundamental in improving the overall project economics of this development."