INTERVIEWSupporting Oﬀshore Electricity
Transmission Project for Oﬀshore
Wind Farm in UK
Project Financing for Project That Involves
Japanese CompanyInterview with NAKASHIMA Keisai,Division 2, New Energy and Power Finance Department I,
Infrastructure and Environment Finance GroupThe Japan Bank for International Cooperation (JBIC) signed in
November 2023 a loan agreement with Triton Knoll OFTO Limited(TK), a British company invested in by TEPCO Power Grid UK
Limited, a subsidiary of TEPCO Power Grid Incorporated (TEPCOPower Grid), and a British infrastructure investment manager,
Equitix Investment Management Limited (EIM). JBIC providedproject ﬁnancing (PF) amounting to up to approximately GBP259
million (JBIC portion) for an oﬀshore electricity transmission
project for the Triton Knoll oﬀshore wind farm in the United
Kingdom (UK). The loan is co-ﬁnanced with Sumitomo Mitsui
Banking Corporation, Societe Generale, Barclays Bank PLC, andAviva Life & Pensions UK Limited, bringing the total co-ﬁnancing
amount to approximately GBP523 million.

Second PF for UK Oﬀshore Transmission ProjectIn this project, TK will own and operate oﬀshore electricity
transmission facilities with a total generation capacity of 857MWthat are connected to Triton Knoll Oﬀshore Wind Farm located 32
km oﬀ the Lincolnshire Coast in the UK. TK will transmit theelectricity generated to Great Britain for 23 years.
“The UK government amended its Climate Change Act in
2019, setting a legally binding target of reducing greenhouse gas
emissions to net zero by 2050 and promoting the introduction ofrenewable energy. As part of this energy policy, it has been
constructing oﬀshore wind farms to achieve a total capacity of 50
GW by 2030. As of September 2023, wind farms with a total
capacity of about 22.5 GW are either operating or underconstruction.
So far, several Japanese trading ﬁrms and electric utility
companies have participated in oﬀshore wind farm projects in theUK, and JBIC has provided PF for some of the UK projects thathave involved Japanese companies: two oﬀshore wind farmprojects, one oﬀshore electricity transmission project, and one
UK-Germany interconnector project. This is the second oﬀshoretransmission project in the UK to which we provided a loan
through PF,” says NAKASHIMA, explaining the initiatives by theUK government and the achievements of JBIC.

Finalizing Contract on Tight Schedule
In early 2021, TEPCO Power Grid contacted JBIC about a loan forthis project, and in October of the same year, it obtained thepreferential negotiation right.
In the UK, the roles of power generation and transmission
companies are divided. It is common that after a generationcompany constructs transmission facilities, a transmission
company that has won the negotiation right in the bidding
acquires the facilities and starts operation. In this project, thetransfer of the asset to TK was scheduled for the spring of 2022.
However, due to a problem, the asset transfer and the operationʼsstart were signiﬁcantly delayed.
“The start of the full-scale loan negotiation was delayed until
2023, when a resolution was in sight. We needed to transfer theasset by the year end, and when we planned backward, we had
to conclude the loan agreement in a short period of time.
However, for the sponsor, TEPCO Power Grid, it was the ﬁrst
overseas transmission project. EIM had extensive experience ininvesting in oﬀshore wind farm transmission projects in the UK,
but we had never worked with them before that.
Therefore, we tried to make our view understood and function
as a policy-based ﬁnancial institution and pursued negotiations
based on our track record of PF in Hornsea1 Oﬀshore Electricity

NAKASHIMA Keisai
Transmission Project in 2021. In the end, we accelerated thenegotiations and reached a basic agreement for the shared goal oftransferring the assets within the year, although many minor
discrepancies came out in the course of the online discussions
between Tokyo and London.
When considering a loan for this project, we checked many
points besides the standard project evaluation, such as whether
problems are properly dealt with and whether the project can beoperated for 23 years in the current state,” NAKASHIMA recalls.
On December 5, 2023, the transfer of the ownership of theelectricity transmission facilities was completed and the operationof the oﬀshore power transmission project started. By leveraging
the knowledge and experience acquired from the operation of thisproject, TEPCO Power Grid will accelerate the expansion ofoverseas projects, reinforce the power transmission grids inJapan, achieve net zero emissions, and reduce costs.

Improvement of Transmission Grids Is the Keyto Carbon Neutrality
NAKASHIMA talks about the future initiatives as follows:“Although it was my ﬁrst experience in structuring a projectusing PF, I managed to contribute toward supporting a quality
energy and electricity infrastructure project that involves aJapanese company, in line with the governmental policies ofstrengthening the international competitiveness of the Japaneseenergy industry and supporting the transition to carbon neutralityand decarbonization.
Since the areas suitable for introducing renewable energy arelimited, the strengthening of networks to transmit electricity fromsuch an area to a remote city will be a big theme in achievingcarbon neutrality. As in this project, these sites are often locatedoﬀ the coast, where construction work is not easy, and are
introducing high-voltage direct-current transmission facilities with
reduced electric power loss. For Japanese companies that aim toparticipate in a project, the more extensive the transmission gridand the higher the voltage, the bigger the investment scale willbe.
JBIC will continue to provide ﬁnancial support not only to
expand the overseas expansion of Japanese companies but also tomake use of the technology and know-how acquired through the
project to strengthen the power lines in Japan by drawing on its
various ﬁnancial facilities and schemes for structuring projects andby performing its risk-assuming function.”