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Green Finance / Treasury & Capital Markets
Deutsche Bank backs Taiwan’s largest wind farm
Bespoke-deal contingent interest rate hedge part of project’s US$6.5 billion financing
Tom King 6 Nov 2023

German lender Deutsche Bank has completed a bespoke-deal contingent interest rate hedge and a tailored financing for Hai Long, Taiwan’s largest offshore wind project to date.

The latest deal is Deutsche Bank’s fourth-largest scale project financing and hedging transaction in the offshore wind sector in Taiwan. To date, the bank has financed nearly 3 gigawatts (GW) of wind power capacity for Taiwan, which represents over 50% of Taiwan’s target for offshore wind energy by 2025.

This transaction also represents the largest offshore wind project financing in the region. The total project cost is forecasted to be approximately US$6.5 billion, of which about US$3.6 billion is being raised through project financing with support from export credit agencies from six different countries, and a number of international and local financial institutions.

Hai Long is a 1GW offshore wind project developed and owned by Northland Power (Canada) and Mitsui & Co (Japan).

Once completed, the wind farm will supply the equivalent of the electricity consumed by more than one million households in Taiwan or roughly 10% of its population, annually. The offshore project is expected to play an important role in helping Taiwan achieve its goal of constructing 5.7GW of offshore windfarms by 2025, and achieving net-zero greenhouse gas emissions by 2050.

The project is Northland’s first offshore wind project in Asia and the fifth in its offshore wind portfolio. Deutsche Bank previously financed the construction of Northland’s first-ever offshore windfarm in The Netherlands.

“Our tailored project finance and risk management solutions for our clients have been instrumental in the buildout of Taiwan’s renewable energy sector,” says Cynthia Chan, the bank’s CEO for Taiwan. “To date, we have helped finance nearly 3GW of wind power capacity for Taiwan across four large-scale transactions. Each transaction is unique and highly complex, involving multiple jurisdictions and a wide range of product requirements.”

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