New service could save wind farm developers up to €50,000
A new ‘due diligence’ service could help small wind farm developers save up to €50,000 in business development transaction costs, according to AIB.
The announced co-operation framework reached between the bank and wind turbine supplier Enercon reflects the view that significant cost and time savings can be achieved if the documentation and due diligence process, confronting smaller wind farm developers, was more standardised and streamlined.
It says that there is strong evidence to suggest that technical and advisory fees associated with raising capital are disproportionately high for projects of this nature.
“Ireland, like every other country, is facing challenging carbon dioxide emissions targets. Given our geographical position on the Western seaboard of Europe, we are well equipped with the natural resource that is wind to feed the national grid,” said Ken Burke, AIB’s Head of Business Banking.
“The availability of capital for small and medium sized wind farm projects, especially the sub-10MW projects, has been constrained over the last five years partly due to the high transactional costs. By taking the time to standardise the documentation and removing duplication in the process, AIB and Enercon have been able to cut due diligence costs.
“This agreement between AIB and Enercon will help reduce the costs for the smaller developer. We are championing the smaller wind farm developers by giving them a better chance of getting their projects off the ground.’’
AIB’s and Enercon’s agreement also means that, once the due diligence begins, it can take as few as four weeks for the customer to draw down the funds. Tralee-based Enercon, which employs 180 people in Ireland, has over 27,000 operating wind farms of all sizes around the world.