Banks Renewables secures £21.9m funding package from The Co-operative Bank for Penny Hill wind farm

May 8, 2012 | Armistead News

Banks Renewables, part of the Banks Group, has completed a £21.9m funding agreement with The Co-operative Bank to fund the construction of its third wind farm in Yorkshire. 

Work on the Penny Hill Wind Farm, is set to begin shortly after Durham-based Banks further strengthened its ongoing relationship with The Co-operative Bank, which previously provided the financial backing for the firm’s Marr and Hazlehead wind farms in the county, as well as for the Armistead scheme in Cumbria, where construction work began last month. 

Penny Hill was cited in a speech by Prime Minister David Cameron at the Third Clean Energy Ministerial Conference in London last week as an example of the sort of renewables scheme that will help meet “our growing energy demands in a way that protects our planet for our children and grandchildren.” 

Around 30 jobs will be created directly on site during the construction of the new six-turbine scheme, which will be located west of the junction of the M1 and M18 to the south east of Rotherham, with a significant number of contracts being awarded to local firms for the supply of materials and sub-contract works. 

The turbines, which are being supplied by industry-leading manufacturer REpower, will have a capacity factor of 3.4MW each, the highest capacity of any ever used in a UK onshore wind farm, and their tower sections will be manufactured by British engineering firm Mabey Bridge at their purpose-built factory near Chepstow. 

The turbines are expected to be delivered to the site by early 2013, with connection to the local grid expected to be finished in later in 2013. 

The Penny Hill Wind Farm will have an installed capacity of 20.4MW, which is enough to meet the annual electricity consumption requirements of approximately 10,000 homes – or around ten per cent of all the homes in the Rotherham area. 

A related benefits fund worth around £20,000 every year – or approximately £500,000 across the 25-year lifespan of the wind farm – will enable Banks to deliver a range of community and environmental improvements in partnership with local people, to help ensure tangible, long-term benefits result from the company’s presence in the area. 

In addition to this, Banks has already made a further £50,000 investment to help establish a Warm Zone scheme across the Rotherham area.  This scheme will deliver practical measures such as cavity wall insulation and loft insulation into local homes in order to help to alleviate fuel poverty and improve domestic energy efficiency on a district-wide basis, and will create further local jobs in itself. 

Establishing a Warm Zone leads, on average, to benefits worth around £3million becoming available to people in the area, in the shape of grants for energy efficiency improvements that will increase a property’s energy efficiency and in turn and reduce household fuel bills, helping to lift people out of the fuel poverty trap.

Neil Brown, group commercial director at the Banks Group, says: “Starting work on our latest onshore wind farm reinforces Banks’ position as one of the leading owner/operators in the UK industry, and we have a number of other sites across our portfolio of developing wind schemes in the north of England and Scotland that will be moving forward in the near future. 

“Carefully designed and sensibly-sited onshore wind farms are viewed by the government as the cheapest form of renewable energy generation, and are central to achieving the twin goals of increasing the amount of indigenous energy that the UK produces by renewable means and continuing to reduce the amount of carbon dioxide that we produce as a nation. 

“Utilising onshore wind farms like Penny Hill to update the UK’s power infrastructure today is already helping to address the energy challenges that we know the 21st century will bring, and we’re very pleased that The Co-operative Bank is continuing to support our investment in state-of-the-art renewables technology.” 

James Sutcliffe, Senior Manager in The Co-operative Bank’s Renewable Energy Team, adds: “We’re delighted to be backing Banks Renewables with this project and be playing a part in helping their ambitious strategy to develop more renewable energy schemes, where they already have a proven track record. 

“We believe medium scale renewables projects such as these can make a significant contribution to the country’s future energy mix and help with the required transition to a low carbon economy.” 

Legal advice on the deal was provided to Banks Renewables by Bond Pearce LLP and Brodies LLP, with Natural Power Consultants and Gallagher Heath also acting on the company’s behalf. 

Sebastian Briggs, who led the Bond Pearce team that worked on the deal, says: “We are very pleased to work with Banks Renewables once again to achieve financial close on the Penny Hill project.  The project finance market is facing a number of challenges, but good quality projects are able to attract funding and the fact that Banks have successfully done so twice in recent months is testament to the quality of their development team.”

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