CIP refinances two biomass power plants in the UK

Copenhagen Infrastructure Partners (CIP) has completed the refinancing of its interest in two biomass power plants in the UK on behalf of the fund Copenhagen Infrastructure I K/S (CI I). The fund has provided equity, preferred equity and senior debt for the development and construction of the two biomass power plants.

The GBP 250 million senior debt financing is delivered by a combination of banks and institutional investors thus confirming the commercial viability and attractiveness of this renewable asset class to the broader debt markets. Royal Bank of Scotland, Investec, Aviva Investors, and one other major institutional investor together acted as lenders on the refinancing.

The plants have now come into operation and senior debt has been sourced from third parties to refinance CI I’s initial investment. The fund retains its ownership interest in the two operating facilities, which are:

• Briggs REP is a 40MW straw fired biomass plant situated in Lincolnshire in UK and was acquired by BPCL in 2013. After the takeover Brigg was successfully completed and commenced operations in January 2016 – three months ahead of schedule. Brigg was awarded 1.5 ROCs.
• Snetterton REP is a 44MW straw fired biomass plant situated in East Anglia in UK and was acquired by BPCL in 2014. Snetterton reached completion in April 2017 – one month ahead of schedule. Snetterton is accredited for 1.4 ROCs.

Rune Bro Róin, Senior Partner at Copenhagen Infrastructure Partners K/S, stated:

“We are focused on investing in green field energy projects and the completion and subsequent refinancing of these two first biomass plants in our portfolio is an important milestone for us. We are delighted to have received the support of the broader debt markets. We are grateful to our current lenders that engaged in this transaction and we are committed to continue building strong relationships with them and will continue to explore debt capital market opportunities.” 

Sarah Wall, Senior Portfolio Manager, Alternative Income Solutions, Aviva Investors commented:

“We were very pleased to work with CIP on this investment, which provides a good match for the strong demand we see from pension funds for assets that deliver reliable, long-dated cash flows with appropriate risk-adjusted returns. We were able to offer a bespoke debt structure to finance the project, helping CIP tailor the financing structure to their needs.”