Saudi Arabia’s PIF buys up to 9.5% stake in wind farm developer Skyborn

The renewable energy company was acquired by an investor consortium in October

FILE PHOTO: A man stands on the beach as the sun sets behind the Burbo Bank wind farm near New Brighton, Britain, May 22, 2018. REUTERS/Phil Noble/File Photo
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Saudi Arabia’s Public Investment Fund has acquired up to a 9.5 per cent stake in offshore wind farm developer Skyborn Renewables as it boosts its clean energy portfolio.

The financial terms of the deal were not disclosed.

Skyborn Renewables has interests in operating and under-construction projects in Germany, France and Taiwan, as well as a pipeline of more than 30 gigawatts of offshore wind projects in various stages of development, the sovereign wealth fund said in a statement on Monday.

“This investment opportunity enhances our objectives to increase our portfolio of investments in the low carbon sector, which now includes solar, power generation, electric vehicles and offshore wind energy,” Turqi Alnowaiser, deputy governor and head of the international investments division at PIF, said.

“Offshore wind has a key role to play in driving global decarbonisation and we see significant growth opportunities for Skyborn.”

In October, Skyborn Renewables was acquired by a group of investors that include Abu Dhabi-based sovereign wealth fund Mubadala Investment Company and Global Infrastructure Partners.

Global offshore wind investment is set to increase this decade, with capital expenditure for projects in the sector expected to more than double to $102 billion in 2030, according to Rystad Energy.

In a 2019 report, the International Energy Agency (IEA) said that global offshore wind capacity may increase 15-fold and attract around $1 trillion of cumulative investment by 2040.

This is driven by falling costs, supportive government policies and technological progress, such as larger turbines and floating foundations, the agency said.

Saudi Arabia, the world's biggest crude exporter and the Arab world's biggest economy, is focusing heavily on renewable energy as it looks to meet its climate commitments while diversifying away from oil exports.

Last month, a PIF unit and Acwa Power signed agreements to develop a solar plant in Makkah with a total capacity of 2.1 gigawatts.

The plant, which is expected to begin commercial operations in the fourth quarter of 2025, will be the “largest of its kind in the Middle East”, the companies said.

In October, the fund joined forces with Saudi Tadawul Group to set up the Regional Voluntary Carbon Market Company, which held an inaugural auction of 1.4 million tonnes of carbon credits.

State-owned oil exporter Saudi Aramco has established a $1.5 billion sustainability fund to invest in “breakthrough” technology and start-ups to help fight climate change.

“Our partnership with Skyborn and Global Infrastructure Partners will help drive the development of innovative sustainable technology, which positions Saudi Arabia as an enabler of industries of the future and the creator of new opportunities,” said Mr Alnowaiser.

The kingdom plans to more than double its target of reducing annual carbon emissions to 278 million tonnes by 2030, Crown Prince Mohammed bin Salman said in October last year. That is up from a previous target of 130 million tonnes.

Capital investments in renewables are set to reach $494 billion this year, outstripping upstream oil and gas at $446 billion for the year, according to Rystad Energy.

Updated: December 12, 2022, 3:59 PM