Image from www.dailkos.com of the North Hoyle wind turbine installation.

Corporate Knights editor Toby Heaps’ story this issue on green power in Ontario got me thinking about how antiquated methods of project financing are a major barrier to the wider development of sustainable energy sources. So I did some research on who in the international financial community is leading the way in green energy project financing. This announcement is about the first non-recourse financing for off-shore wind farms in the industry:

EUR 379 M Facilities for the construction and operation of an offshore wind farm

ROTTERDAM/UTRECHT, 25 October 2006 - Cooperatieve Centrale Raiffeisen Boerenleenbank B.A. (Rabobank) and Dexia Credit Local (Dexia) as Mandated Lead Arrangers, and Eksport Kredit Fonden (EKF), as export credit agency, have closed on 25 October 2006 the financing for the construction and operation of the Q7 windfarm, a 120 MW offshore wind park, comprising 60 Vestas V-80 wind turbine generators, located off the Dutch coast near IJmuiden. This financing is believed to be the first ever non recourse financing for an offshore wind farm.

Ontario and Canada’s potential for these kinds of wind projects is virtually limitless as long as we have the financing on the front end and an adequate distribution network on the back end. The Dutch financing is a breakthrough and will no doubt become a reference standard for green financing in the future. If, as Toby writes, Canadian investors like the Canada Pension Plan Investment Board are indeed looking for large, green infrastructure projects, they will reference Rabobank, Dexia, and EKF’s move as an indication that institutional funds are moving in the right direction.