Vattenfall enters a partnership with Greencoat UK Wind and gives the green light to the construction of South Kyle, its largest onshore wind farm in the United Kingdom.
Vattenfall has taken the final investment decision to construct South Kyle Wind Farm, which will be able to power approximately 170,000 UK homes, saving close to 300,000 tonnes in carbon dioxide emissions annually.
“The planned construction of the South Kyle Wind Farm shows our commitment to the United Kingdom and its transition to climate neutrality as well as delivering on Vattenfall’s goal to enable fossil free living within one generation,” says Magnus Hall, CEO of Vattenfall.
As an essential part of the project Vattenfall has entered a partnership with renewable infrastructure fund Greencoat UK Wind, who will acquire the wind farm following its completion.
Vattenfall will construct the wind farm and will manage the asset on behalf of Greencoat for a minimum of 10 years. Vattenfall will also purchase the power for a period of 15 years.
“The transition towards a fossil free future is in full swing and requires large investments in renewable energy. Therefore, we are delighted to be partnering with Greencoat UK Wind and realise the South Kyle Wind Farm. South Kyle will significantly contribute to the renewable energy production in Scotland,” says Gunnar Groebler, Senior Vice President and Head of Business Area Wind at Vattenfall.
Greencoat UK Wind also announced that it has entered into an agreement with Vattenfall Wind Power to acquire South Kyle wind farm for a headline consideration of £320 million, which will be due upon completion, scheduled for Q1 2023, once the wind farm commences commercial operations.
South Kyle is located 5km to the east of Dalmellington on the boundary of Dumfries & Galloway and East Ayrshire in Scotland. It will consist of 50 turbines with aggregate generating capacity of 240MW and a grid connection of 235MW. The wind farm is fully consented.
South Kyle is a subsidy free wind farm and it has entered into a route-to-market PPA with Vattenfall Energy Trading GmbH for the 15 years following commissioning. Vattenfall will construct the wind farm and will manage the asset on behalf of Greencoat UK for a minimum of 10 years once operational.
In addition to supporting the local economy through new jobs created, once operational, the wind farm will provide £38 million of direct investment into local schemes through its community benefit programme over the lifetime of the wind farm.
“We are delighted to enter into an agreement with Vattenfall, our fifth major utility partner. South Kyle is in close proximity to a number of other wind farms already owned by Greencoat UK Wind, and we are confident it will be another high-quality addition to our portfolio,” Tim Ingram, Chairman of UKW, commented.
“We are pleased with the transaction, which will bring a large-scale subsidy free wind farm under our ownership. While we continue to expect the majority of our portfolio to comprise ROC accredited assets, the scale of our portfolio and balance sheet allows us to acquire a combination of different types of UK wind farms, such as South Kyle, and thereby find best value for shareholders,” Laurence Fumagalli of Greencoat Capital LLP added.
In line with UK government guidance to ensure the safety of employees amid the COVID-19 pandemic, construction of the wind farm will begin once it is appropriate to do so.
Therefore, a timeline for construction is yet to be confirmed. Vattenfall is continuously monitoring precautions concerning COVID-19 and currently plan for the wind farm to be operational early 2023.
Facts about South Kyle Onshore Wind Farm:
Total maximum capacity is 240 MW
Capacity can supply approximately 170,000 UK homes
Number of turbines is 50
Total height from tip of rotor blade is 149.5 meters
Location is South West of Scotland
Commercial operation is planned to start Q1 2023
About Greencoat UK Wind
Greencoat UK Wind is a renewable infrastructure fund, invested in 36 operating UK wind farms with net generating capacity of 998MW. They provide investors with the opportunity to participate in the ownership of UK wind farms, thereby increasing the resources and capital dedicated to the deployment of renewable energy and the reduction of greenhouse gas emissions.
