The future of wind energy
The question is not whether in the future, energy producers will generate sustainable energy only, but rather which forms of sustainable energy they will choose. Over 50 percent of investments in replacing older power stations is already aimed at sustainable sources such as solar and wind. Rabobank is one of the global leaders in financing large-scale wind farms, particularly for offshore projects. The bank works closely with local initiators, construction companies and financial partners such as pension funds and insurers.
Sustainable power generation is irreversible
Rabobank sets great store by sustainability. That is why the bank has already been financing wind turbine projects since the 1990s. The bank has acquired extensive experience in financing wind farm projects. It is seen globally as one of the leaders in financing large-scale wind farms, regularly acting as leader of consortiums in which various banks participate. The bank is a specialist in structuring and building financial solutions that enable the parties involved to finance projects and to subsequently sell on the projects to institutional investors, such as pension funds. These institutional investors seek acceptable returns at limited risks and often want to participate when the projects are operational.
Dutch offshore industry
Dutch businesses are well-represented in the international market for wind energy. Around 60 to 70 Dutch clients of Rabobank, including large companies in the offshore industry, are suppliers for wind farms, mainly offshore. By financing this kind of project, Rabobank is therefore also indirectly helping its clients in the Netherlands. At present the bank is involved in projects not just in the Netherlands but also in Germany, the United Kingdom, Ireland, Scandinavia, France, Belgium, the United States, India, Brazil and Chile.
Contributing to the Energy Agreement
At the end of 2014, onshore capacity in the Netherlands totalled around 2.5 gigawatts. In the Energy Agreement, this is targeted to be increased to 6 gigawatts by 2023. As the Dutch market leader in financing wind turbines, Rabobank is making a major contribution to the growth of sustainable energy generation, as agreed in the Energy Agreement. The bank played a leading role, for instance, in financing the largest onshore wind farm in the Netherlands, NOP Agrowind. This project in the municipality of Noordoostpolder has a capacity of 195 megawatts, with which it can provide electricity to some 180,000 households. In addition, the bank co-financed the first nearshore wind farm Westermeerwind in the Dutch city of Emmeloord, which has a capacity of 144 megawatts. Enough energy for around 130,000 households to use their washing machines and lights at home.
Globally, Rabobank is among the top ten providers of finance for renewable energy, in the Bloomberg New Energy Finance League Table (2014).
|Amounts in millions of dollars|
|Rank||Company name||Count||Credit||Table Share (%)|
|1||Banco Nacional de Desenvolvimento Economico e Social||24||2.696,87||7,81|
|2||Mitsubishi UFJ Financial Group Inc||34||2.031,80||5,98|
|3||Mizuho Financial Group Inc||28||1.907,27||5,52|
|4||Sumitomo Mitsui Financial Group Inc||24||1.594,52||4,62|
|5||European Investment Bank||10||1.523,69||4,41|
|6||Banco Santander SA||27||1.347,31||3,90|
|7||Societe Generale SA||12||984,65||2,85|
|9||Deutsche Bank AG||12||910,47||2,64|
|10||Cooperatieve Centrale Raiffeisen-Boerenleenbank BA||14||865,30||2,51|
Transition to sustainable energy
By financing large-scale wind farms, Rabobank is contributing to the transition to sustainable energy generation. The latter is virtually certain to become a reality, although there are still some relatively minor issues that need to be resolved. The first of these is the storage of energy generated from sustainable sources. Currently, there is still more energy available on days with strong winds, for instance, while consumers and business naturally also want to be able to use energy on days when winds are calm. The power network is moreover not yet ideally suited to transmitting wind-generated power. For instance, the connection between the wind farms on the northern coast of Germany and a city in the south such as Munich is not satisfactory. Once the storage issue is resolved and connections between power networks are improved, there will be few obstacles to wind energy taking off in a major way.
Wind turbines alone will evidently not resolve the world’s energy problem. Ultimately, the solution for a world in which only green energy is produced will be a combination of several sustainable sources of energy, such as biomass, solar, tidal energy, hydropower and wind. Therefore the question is not whether we will be generating only sustainable energy, but which sources we will choose for doing so.
Wind farm projects sometimes give rise to conflicts between economic and social interests, for instance those of neighbouring residents. Rabobank has no involvement in these. It only provides finance and never acts as an initiator of a wind farm – that is a matter for market parties and the government. It is however very important to the bank that the construction of a wind farm is preceded by extensive democratic processes, including opportunities for public consultation. Applications for financing or co-financing a wind farm are required to comply with the rules of the bank’s sustainability policy. The primary criterion is that the project complies with Dutch and European laws and regulations and licensing requirements.