The bonds, priced at EUR 250 and offering a return of 4.15 % for five years, were issued by an Electrabel subsidiary, Electrabel Green Projects Flanders, to part finance the EUR 23 million development costs of three wind stations in Hoogstraten, Hooglede and Wondelgem, with a combined capacity of 17.7 MW. By giving first refusal to local residents, the issue was also intended to increase local involvement in the projects.
In this it has been a great success, says Electrabel's Simon van Wijmeersch. The issue was oversubscribed by four times the number of bonds within 48 hours making it "crystal clear that people want to invest in renewable projects, especially when there is a solid partner behind the projects."
Admitting surprise that the issue was sold out so quickly, Van Wijmeersch adds that success gives a clear message encouraging mutual involvement in wind development projects. "By offering local people the opportunity to benefit from this bond and the fact that there was a clear response shows that the message was received on both sides and will encourage mutual involvement in renewable projects."
Although Electrabel has no plans to finance other green power projects through bond issues, Van Wijmeersch adds "there is no doubt that citizens' involvement to support investments in wind projects will occur more and more, since there is a clear local demand."
The reaction from other Belgian wind developers was, however, lukewarm. Luc Debusschere of Belgian public power producer SPE, although recognising the publicity value of the initiative in generating local support, says his company has no plans to follow Electrabel's example, preferring to foster local involvement by developing projects jointly with local co-operatives in which nearby residents could invest. Aspiravi, which took over the generating capacity of the numerous local power companies on the liberalisation of the Flemish power market in April 2002, also says it has no plans to follow the Electrabel example. It currently has some 74 wind farms under development.
Of the three wind plant to be partially bond financed, construction has already started at Hoogstraten, (6 x 2 MW) and all necessary permits have been obtained for Hooglede (2 x 850 kW) and Wondelgem (2 x 2 MW) came online in November.