PE Firms Talk Offshore Windfarms

LONDON, April 28 (Reuters) – British utility Centrica (CNA.L: Quote, Profile, Research) has approached private equity groups Blackstone (BX.N: Quote, Profile, Research) and Apax APAX.UL about co-funding major offshore windfarms, an industry source said on Monday.

Centrica, which said in February it was mulling a multi-billion pound increase in renewable energy investment, is sounding out potential partners for at least three upcoming projects off the coast of Lincolnshire, eastern England.

Top of the agenda is Lincs, a 250MW offshore windfarm currently under the scrutiny of British planning authorities.

The source said Lincs could power 180,000 homes and cost over 500 million pounds ($993 million) to build — prompting Centrica to sound out potential partners.

The source said Centrica could yet fund the construction of Lincs on its own, but its next two planned offshore farms, Race Bank and Docking Shoal, could cost 1 billion pounds each and would definitely require a partnership.

The source said Apax and Blackstone were two of the parties involved, while others in and out of the private equity sector were also likely to be targeted.

Neither Apax nor Blackstone could be reached immediately for comment. “We are open to talks with that kind of investor,” a spokesman for Centrica said.

Centrica currently has one offshore windfarm in operation, at Barrow — off Britain’s west coast. It has two more in the pipeline off Lincolnshire, but these are smaller and at a cost of 300 million pounds can be managed by Centrica alone.

The new builds are designed to help Britain meet ambitious goals of producing 33 gigawatts of electricity from offshore wind by 2020, enough in theory to power every British home.

(Reporting by John Bowker, Additional reporting by Mathieu Robbins; Editing by David Cowell)