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Canada, Taiwan-led group buy 50% of Taiwan wind farm project for NT$75 billion

CDPQ
By Hui Ching-hoo   
December 30, 2020

Canadian pension fund Caisse de dépôt et placement du Québec (CDPQ) and Taiwan’s Cathay Private Equity are leading a consortium that’s buying a 50% stake in an offshore wind farm project in Taiwan for NT$$75 billion (US$2.66 billion) from Denmark’s Ørsted.

The Danish green energy firm, which will retain the other 50% shareholding in the Greater Changhua 1 wind farm, will use the proceeds to finance engineering, procurement and construction services for the project.

The wind farm is expected to be completed by 2022, Ørsted says in a statement on December 28.

It did not disclose the identity of the other consortium members.

“This transaction marks the evolution of our partnership model in Taiwan, leveraging our extensive track record of development, construction and operation of large offshore wind farms,” Kunal Patel, the company’s vice president and head of partnerships and structured solutions, says in the statement.

The project marks the first partnership between Ørsted, CDPQ and Cathay Private Equity. It’s also the Canadian pension fund’s first direct investment in Taiwan.

“As an investor with vast experience in renewable energy, we seek this kind of greenfield opportunity to contribute to the transition towards a low carbon economy,” Emmanuel Jaclot, CDPQ’s executive vice-president and head of infrastructure, says in the statement.

Jeff Chang

Taiwan’s government is promoting development of renewable energy, which it aims to increase to 20% of total energy supply on the island by 2025, from around 6% in 2019. It’s encouraging local insurers and fund managers to invest in green energy infrastructure.

Cathay Private Equity, the three-year-old private equity arm of Cathay Securities Investment Trust Co, has invested NT$8 billion in local sustainable investment projects, including green energy, to support the government’s push.

Jeff Chang, chairman of the private equity firm, describes the wind farm deal as a “landmark transaction” that represents “an important milestone” in Taiwan’s transition towards a low-carbon economy.

It “fits perfectly” with Cathay Private Equity’s investment mandate to invest in “high quality energy infrastructure projects alongside world class partners”, he says in the statement.

CDPQ, which manages public pension plans and insurance schemes in the Canadian province of Quebec, had C$333 billion (US$259.5 billion) of total assets as of June 2020.

Taipei-based Cathay Investment Trust Co had $23.4 billion of total assets as of March 2020.