Financing pieces fall into place

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A long awaited ruling has catapulted the Netherlands' 120 MW WP-Q7 offshore wind project from out of its year long slumber and into the starting blocks. Construction begins in the autumn, for completion in 2005.

Project developer E-Connection received word in December that Q7 is entitled to the so-called "VAMIL" tax break on environmental investments, despite its location outside territorial waters in the Dutch economic zone. Project finance was conditional on securing this benefit. The application had been submitted in March 2001 (Windpower Monthly, October 2003).

Just one formality remains, says E-Connection's Mathieu Kortenoever, and that is confirmation that Q7 is entitled to the subsidy for environmentally friendly power production, the MEP, introduced in July. The agency responsible for issuing the notification, CertiQ, is struggling to keep pace with applications for the MEP, he adds. Offshore turbines will be paid a MEP subsidy of EUR 0.068/kWh for the first ten years of their life, which is "adequate," says Kortenoever. Once the project's eligibility for the MEP subsidy is in place, construction work on the monopiles and cabling can begin.

E-Connection is a joint venture which includes Danish wind turbine manufacturer Vestas, monopile makers Smulders Groep, Fabricom Oil & Gas and foundation supplier Mammoet Van Oord. WP-Q7, to consist of 60, Vestas 2 MW turbines, will be built 25 kilometres off the Dutch coast at IJmuiden in water depths of 20-25 metres.

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