AlternativesDecember 29, 2020

CDPQ, Cathay Take 50% Stake in Taiwanese Wind Farm

The deal amounts to a $2.7 billion transaction.

Reported by Sarah Min

The Caisse de dépôt et placement du Québec (CDPQ) and the private equity arm of Taiwanese asset management firm Cathay Securities Investment Trust (Cathay SITE) will take a 50% stake in what is expected to be the biggest offshore wind farm in Taiwan when completed.

The Greater Changhua 1 Offshore Wind Farm will be constructed, operated, and maintained by Danish energy company Ørsted, which will maintain 50% ownership of the power system, CDPQ said Monday. The deal amounts to a $2.7 billion transaction.

“This investment in Taiwan, which represents an attractive market for CDPQ, allows us to further diversify our presence in Asia,” Emmanuel Jaclot, CDPQ executive vice president and head of infrastructure, said in a statement.

“As an investor with vast experience in renewable energy, we seek this kind of greenfield opportunity to contribute to the transition towards a low–carbon economy,” he added.

The Changhua 1 wind farm will also be the first in a two-part project that will have 900 megawatts (MW) of capacity, or enough energy to power about 1 million Taiwanese households. Construction for both projects are expected to finish by 2022.

Another set of wind power projects totaling 920MW, Changhua 2b and 4, will also be completed by Ørsted by 2025, pending a final investment decision the developer will take by 2023.

The partnership between CDPQ, Cathay SITE, and Ørsted is the first of its kind in the Asian Pacific wind sector, according to the release. The multi-tranche investment package CDPQ and Cathay SITE have financed has been put together by 15 banks and two life insurance companies. Those include BNP Paribas, CTBC Bank, Cathay Life Insurance, Cathay United Bank, Crédit Agricole, Deutsche Bank, DZ Bank, E-SUN Bank, HSBC, Korea Development Bank, Taipei Fubon Bank, Taiwan Life Insurance, Oversea-Chinese Banking Corporation, Siemens Bank, Société Générale, Standard Chartered, and Sumitomo Mitsui Banking Corporation.

The package was also supported by guarantees and loans from five export credit agencies, including the Atradius of the Netherlands, Eksport Kredit Fonden (EKF) of Denmark, Export Development Canada (EDC), Korea Trade Insurance Corporation (KSURE), and UK Export Finance (UKEF).