Cape Wind said Tuesday it expects to complete financing for its long-delayed 468-megawatt offshore wind farm and start construction of the project in U.S. federal waters off Cape Cod, Mass., by the end of the year.
Cape Wind said in a statement it selected Bank of Tokyo-Mitsubishi UFJ, a unit of Japanese bank holding company Mitsubishi UFJ Financial Group, as its co-ordinating lead arranger of the commercial bank portion of the debt financing for the project.
The wind farm has been in development since 2001. Cape Wind has said some turbines could be in service in 2015.
Energy experts have said it will cost about $2.6-billion (U.S.) to build the wind farm.
Separately, the U.S. Department of Energy is considering a loan guarantee for the project. Cape Wind said it cannot say how much it is seeking from the DOE.
BTMU is providing a significant amount of debt capital that will be used to pay for development and construction of the project, Cape Wind said. The company could not say how much BTMU was expected to raise.
“Obtaining financing is one of the last steps to complete before proceeding with the construction of the project,” said Jim Gordon, Cape Wind president.
Several developers are working to become the first U.S. offshore wind farm, including Cape Wind and privately held Deepwater Wind, off Rhode Island.
A unit of U.K. bank Barclays PLC will continue to advise Cape Wind on raising the remaining financing needed, Cape Wind said.
Cape Wind has sold 77.5 per cent of its power output in long-term power purchase agreements to the Massachusetts unit of National Grid PLC and Northeast Utilities’ NSTAR unit, the two largest power companies in Massachusetts.