Orkney Islands Council’s community wind farm project

QMPF is pleased to announce that it has advised Orkney Islands Council on securing a loan from The National Wealth Fund (NWF) for its 28.8MW wind farm at Quanterness. The project – in development since 2019 – was unanimously backed by elected members in February this year and will see six 149.1m turbines built at the site in St. Ola, situated between Kirkwall and Finstown.

The loan of up to £62.1m covers the cost of the project build, contingency and interest. The loan, provided through NWF’s Local Authority Lending and Advisory Team, provides low-cost, long-term financing for the community wind farm meaning no further draw from the Council’s Strategic Reserve Fund is required to deliver the project. The Council also has an option to return funds spent to date back to the Strategic Reserve Fund through the loan.

Quanterness wind farm benefits from a CfD, awarded in AR4 and it is estimated that it could generate an annual income of more than £3m (in today’s money) for the Council, providing a new revenue stream to protect and develop public services.

The wind farm will also support the delivery of the Scottish and Southern Electricity Networks (SSEN) interconnector cable which will be used to transport the electricity to the Scottish mainland.

QMPF’s role included financial modelling of the wind farm and analysis of various performance and cost scenarios to support the Council’s Final Investment Decision in February. Concomitantly, QMPF supported the Council in its engagement with the National Wealth Fund to secure its loan for Quanterness.

Chris Purnell, Strategic Projects Director – Enterprise and Economic Growth, Orkney Islands Council said:

“We wish to express our sincere appreciation to QMPF for its outstanding professional support and strategic guidance throughout the Final Investment Decision process and in securing the facility agreement. These achievements represent critical milestones in the progression of the Quanterness wind farm project, and QMPF expertise has been instrumental in delivering these outcomes.”

Andrew Dougans, Partner, QMPF said:

“We’re proud to have supported Orkney Islands Council in securing this landmark £62 million loan from the National Wealth Fund. This funding will help unlock long-term value for the community and accelerate the delivery of clean energy infrastructure. QMPF is delighted to have played a role in enabling this transformative project.”