A multi-million US dollar wind farm in Hawaii is to use letters of credit (L/Cs) in its financing package.

This is the latest sign of an increasing number of renewable energy power producers using L/Cs to partially finance their projects.

Kawailoa project

The US independent company, First Wind, is to build a 69-megawatt power plant at Kawailoa in Hawai.

The total project cost is US$236 million, to be funded by a US$220 million non-recourse construction and term loan, topped up with a US$16 million L/C facility.

The financing was led by Union Bank, with other joint lead arrangers including Bayern LB, Rabobank and Siemens Financial Services.

Other US projects

This is the latest of several wind power projects in the US to feature L/C financing.

These include several multi-million US dollar projects in the so-called Texas Panhandle (DC World News, 14 December 2009) and five more in Wyoming and Colorado (DC World News, 26 May 2010).

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