Dong 'to sell 25% of London Array to Caisse'

Dong is close to selling half its 50% stake in the London Array offshore wind farm to the public pension fund Caisse de dépôt et placement du Québec, in a deal with broader implications for the offshore market.

The Caisse is contemplating sinking £500m ($788.6m) into the 630MW London Array, thereby reducing Dong’s stake to 25%, according to the Financial Times. E.ON and Masdar own the remaining 50% of the project.

A Dong spokesman declined to comment, repeating only that Dong’s offshore wind strategy includes the possibility of selling up to 50% stakes in projects – as it has done with Anholt, Gunfleet Sands, Walney and Borkum Riffgrund 1.

However, the timing of the report is interesting, coming less than two weeks after Dong announced its final investment decision for the €1bn ($1.34bn) Westernmost Rough project, weighing in at 210MW off the coast of northeast England.

The offshore wind industry hopes to see a growing appetite for offshore wind assets among institutional investors such as pension funds and insurers in the coming years, taking some pressure off the balance sheets of the power utilities building the projects.

To date, most such interest has come from European players, particularly in Denmark, due largely to that country’s extensive familiarity with wind energy.

But the introduction of Québec’s Caisse into the market would be seen as opening a new chapter for investment into the space.

The Caisse, which oversaw C$159bn ($158bn) at the end of 2011, last month sank C$500m into a 1.5GW portfolio of North American wind farms operated by Invenergy.