Expert says that despite headwinds, the appetite remains for good projects in the renewables sector
A major refinance of a pioneering wind farm shows how the Australian renewables market has evolved, an expert says.
The comment came from partner Elizabeth Charlesworth, who jointly headed a Herbert Smith Freehills (HSF) team with partner Andrew McLean to help refinance the Hornsdale Wind Farm.
“The successful refinancing of the landmark Hornsdale Wind Farm on a platform basis represents the evolution of the Australian renewables market,” Charlesworth said. “While the sector is still experiencing growth, this transaction shows that onshore wind is increasingly being seen as a stable and mature asset class capable of delivering stable long term returns for both debt and equity.”
She also provided a positive outlook on the renewables industry in Australia.
“This refinancing also shows that despite recent challenges in the market, the appetite is still there for good projects with solid fundamentals. Refinancings such as this one can deliver significant value to both debt and equity, and we expect to see a number of these platform style financings in the coming year as investors look to consolidate their portfolios and capitalise on the benefits that come with economies of scale,” Charlesworth said.
HSF advised both incoming lenders and existing lenders on all aspects of the $650m consolidated platform refinancing for Stage 1, Stage 2, and Stage 3 of the wind farm, which was the first multi-staged, separately project-financed wind farm in Australia.
The HSF team that advised on all aspects of the refinancing also included senior associate Gabby Herron-Cartwright, as well as solicitors Hiroko Ito, Dave Thomas, and Jacinta Dzarir.
The wind farm, located about 200km north of Adelaide, features 99 turbines with a capacity of 209MW. Its three stages are now all complete and in operation. French renewable energy producer Neoen Australia owns a majority of the project. International infrastructure investor John Laing also has a stake in the project, which Siemens operates and maintains.
HSF has long been advising on the Hornsdale Wind Farm. It advised on the three stages of the project in 2015, 2016, and 2017, respectively. The firm said that the refinancing brought together the different stages under a single combined financing arrangement.
The arrangement allows for varying tenors of debt. The financing was provided by an all-international group of lenders consisting of Korea Development Bank, Mizuho Bank, Natixis and Société Générale.
“The restructuring and consolidation of the financing in this way has allowed the wind farm to secure long tenor debt on favourable terms,” HSF said.
