Cape Wind has signed a term sheet to engage The Bank of Tokyo-Mitsubishi UFJ (BTMU) as its coordinating lead arranger of the commercial bank portion of the total debt financing for the 130-turbine, 468 MW Cape Wind offshore wind farm.
Outside analysts have estimated the project cost will be $2.6 billion. Cape Wind said it expects to complete project financing and begin construction by the end of the year, which would qualify it to receive an investment tax credit covering 30 percent of a project's costs.
BTMU is providing debt capital that will be used to pay for development and construction costs. Cape Wind expects to complete project financing and begin construction by the end of the year.
Barclays is Cape Wind's financial advisor and will work with Cape Wind to raise the remaining necessary financing.
"Obtaining financing is one of the last steps to complete before proceeding with the construction of the project," said Jim Gordon, Cape Wind President. "Together with BTMU, we are engaging a group of experienced financial institutions as our core banking group and look forward to completing the financing of America's first offshore wind farm which will deliver significant environmental, energy and economic benefits to Massachusetts and the surrounding region."
Cape Wind signed power purchase agreements with National Grid and NSTAR. The project completed its federal licensing process in January 2011.