Borders firm wins £50m funding for its small-scale wind farms

Published on Sunday 26 September 2010 22:59

PRIVATE equity investors yesterday pumped £50 million into a small, Borders-based wind energy developer in an attempt to set up "hundreds" of mini projects across rural Scotland.

The investment came on the eve of the two-day Scottish Low Carbon Investment Conference in Edinburgh, which organisers say has attracted major financiers from around the world.

E-Gen, based at Duns, in Berwickshire, develops small wind farms with up to three turbines each. It has four sites already in the planning system and a further 25 on the drawing board.

The money from Rockfield Energy Investments - an energy investor backed by London-based Bregal Capital - will allow the firm to set up a new business, E-Gen Partners, which will work with farmers and landowners to fund the development, construction and operation of hundreds of small-scale wind projects.

E-Gen has developed a computer-based mapping tool to find the best sites where wind speeds, planning consent and grid connections are optimised.

The company pays an annual ground rent to landowners based on the number of turbines, in exchange for a 20-plus year lease of their land.

Tom Forsyth, E-Gen's chief executive, said: "We believe our business model can deliver big benefits to farmers and landowners across rural Scotland by adding value to their properties and boosting their incomes at no cost or risk to themselves.

"In terms of number or size of turbines we are not typical wind farm developers. Our sector is the community-scale project for which planning consents are typically faster and less complex, and visual impact is minimal."

Forsyth said he wants to make the most of the UK government's feed-in-tariffs (FITs) - which pay people for the renewable energy they produce - before they are reviewed in 2012.

Martin Pickard, Rockfield Energy's chief executive, said: "This investment is part of our strategy to establish 'buy and build' portfolios of renewable assets."We are impressed by E-Gen's approach to developing wind projects and their team of specialist contractors and advisers."

Bregal Capital is part of Bregal Investments, the private equity arm of Cofra Holdings, a Swiss family-owned group which also owns clothing retailer C&A, property firm Redevco and Brazilian bank IBI.

Today's conference will be opened by First Minister Alex Salmond, with speakers including ScottishPower chief executive Nick Horler, Scottish & Southern Energy chief executive Ian Marchant, Royal Bank of Scotland chief economist Andrew McLaughlin and Jim McColl, chairman of Clyde Blowers.

Niall Stuart, chief executive of trade body Scottish Renewables, said: "It's clear that Scottish companies are attracting significant sums of investment and using new incentives, such as the FITs, to maximise the economic and environmental rewards that our wind resource offers."

Commenting on the E-Gen deal, he added: "A model that takes the risk away from landowners and farmers but gives them a guaranteed return will no doubt be attractive to many."