Northland Power Inc. announced this week that the Deutsche Bucht Mono Bucket pilot demonstrator ("Demo") project has reached financial close. All required funds for the Demo project have been contributed by Northland and committed by the project lenders.

In May, the Federal Maritime and Hydrographic Agency of Germany (BSH) granted the Deutsche Bucht offshore wind project the permit required to erect two additional pilot wind turbines using Mono Bucket foundations. Deutsche Bucht will be the first offshore wind farm worldwide to test this new type of foundation structure under commercial operating conditions. As previously announced, the two turbines will contribute an additional 17 MW of capacity to the base 252 MW project for a total of 269 MW and bringing the total project cost to approximately €1.4 billion (CAD $2.0 billion) – up from €1.3 billion. Northland’s corporate investment has increased from approximately $400 million to approximately $430 million, funded by cash on hand. The balance of the Demo project cost will be funded with non-recourse project finance debt and pre-completion revenues.  Production from the additional 17 MW Demo project will earn the same fixed feed‐in tariff subsidy for approximately 13 years under the German Renewable Energy Act ("EEG") as the base project, equating to approximately €184/MWh for 8 years and €149/MWh for the remainder.  The Demo project is expected to be accretive to the base project since it will share the base project’s infrastructure.   Inclusive of the additional 17 MW from the Demo project, Northland owns 100% of the 269 MW offshore wind farm, which will be located in the German North Sea.

John Brace, CEO of Northland Power, said: 
“Today’s announcement represents yet another first for Northland Power. The addition of the Demo turbines is not only innovative and accretive to the base project, but we are able to undertake this initiative with little additional risk since they will be integrated into the overall construction project. The innovative new mono bucket design could be of significant benefit to some of Northland's future offshore wind farms. The learnings from this pilot could allow Northland to construct faster and lower costs for certain site conditions.”

The Deutsche Bucht project is currently under construction, with completion anticipated in the second half of 2019.

Northland Overview

Northland is 100% owner of the approximately EUR1.4 billion DeBu offshore wind project, and will play an active role throughout construction and operations. DeBu has a capacity of 269 MW, and is located 95 km west of Borkum in the German Exclusive Economic Zone (EEZ), 77 km from Northland’s other German offshore wind project, Nordsee One.

Features

• Strong winds and approximately 40m water depth provide ideal conditions
• Power contract with feed-in-tariff subsidy for approximately 13 years under the German Renewable Energy Act
• Robust project returns meet Northland's investment criteria
• Two-contract construction strategy: MHI Vestas will supply and install the turbines. Van Oord, the balance of plant contractor will provide the turbine installation vessel and supply and install the wind turbine foundations and the offshore electrical infrastructure. MVOW will also maintain the turbines under a long-term service contract. DeBu will be connected to the 800 MW BorWin Beta off-shore converter station which has already been constructed.