Loan (KfW Programme offshore wind energy)
Updated: 11.01.2019
Author: Tim Sternkopf
The KfW-Programme offshore wind energy provides loans and financing packages to support companies wanting to invest in offshore wind farms in the German Exclusive Economic Zone or in 12 nautical-mile zone of the North and Baltic Sea. Project financing is granted in different forms:
- a) direct loans under financing by bank syndicates
- b) financing package combining a KfW on-lent through a bank loan and a direct loan from KfW
- c) in addition to a) and b), a direct loan under bank syndicates is granted covering unforeseen costs during construction phase
Eligible technologies
Under the KfW-Programme only offshore wind power is eligible. Financial support is granted for the construction of up to 10 offshore wind farms.
| Wind energy | Offshore wind energy |
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Amount
The proportion of co-financing the investment is the following for the different forms of finance:
- up to 50 percent of overall external capital requirements, max. EUR 400 million per project
- up to 70 percent of overall external capital requirements, max. EUR 700 million per project
- up to 50 percent of overall external capital requirements for unforeseen cost increases, max. EUR 100 million per project.
It is a long-term and low-interest loan during a period of 20 years including a 3-year repayment-free start-up period. The fixed interest rate is renegotiated after 10 years. Moreover, a commitment fee of 0.25% per month is charged.
Addressees
Project companies wanting to invest in offshore wind farms in the German Exclusive Economic Zone or in 12 nautical-mile zone of the North and Baltic Sea. Companies under restructuring or in difficult situation in the meaning of European Community Guidelines for State Aid for Rescue and Restructuring of Companies in Difficulty are excluded.
Procedure
Process flow | Applications for projects to be implemented under financing package (b) are to be filed with a credit institution of borrower’s choice. Applications for a direct loan are filed with KfW via any credit institution. |
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Competent authority | KfW loans are administered and disbursed by regular banks. |
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Distribution of costs
| State | The KfW Bankengruppe bears the costs of offering low-interest loans. |
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| Plant operator | The plant operator has to pay back the loan. |
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Germany
