Annual Report
For the year ended 31 December 2021
G R E E N C O A T
U K W I N D
Summary 01
Chairman’s Statement 02
Investment Manager’s Report 05
Strategic Report 21
Board of Directors 34
Report of the Directors 37
Directors’ Remuneration Report 40
Statement of Directors’ Responsibilities 44
Corporate Governance Report 45
Audit Committee Report 50
Independent Auditor’s Report 54
Financial Statements 61
Notes to the Financial Statements 67
Company Information 96
Supplementary Information 97
Defined Terms 98
Alternative Performance Measures 101
Cautionary Statement 102
Contents
G R E E N C O A T
U K W I N D
All capitalised terms are defined in the list of defined terms on pages 98 to 100 unless separately defined.
Summary
Highlights
• The Group’s investments generated 2,933GWh of renewable energy.
• Net cash generation (Group and wind farm SPVs) was £256.8 million.
• Acquisition of the remaining 50 per cent interest in Braes of Doune, investments in Andershaw, Burbo Bank
Extension, Windy Rig and Glen Kyllachy, and the commissioning of Douglas West increased the portfolio to
43 operating wind farm investments and net generating capacity to 1,422MW as at 31 December 2021.
• Issuance of further shares raising £648 million.
• The Company declared total dividends of 7.18 pence per share with respect to the year and is targeting a
dividend of 7.72 pence per share for 2022 (increased in line with December 2021 RPI).
• £950 million outstanding borrowings as at 31 December 2021, equivalent to 23 per cent of GAV.
Key Metrics
As at As at
31 December 2021 31 December 2020
Market capitalisation £3,257.8 million £2,448.0 million
Share price 140.6 pence 134.2 pence
Dividends with respect to the year £148.0 million £118.7 million
Dividends with respect to the year per share 7.18 pence 7.10 pence
GAV £4,043.7 million £3,329.9 million
NAV £3,093.7 million £2,229.9 million
NAV per share 133.5 pence 122.2 pence
NAV movement per share (adjusting for dividends) 11.3 pence 0.7 pence
Total return (NAV) 15.4 per cent 6.5 per cent
TSR 10.7 per cent (6.2) per cent
CO
2
emissions reduced per annum 1.7 million tonnes 1.5 million tonnes
Homes powered per annum 1.5 million homes 1.2 million homes
Funds invested in community projects in the year £3.0 million £3.8 million
Alternative Performance Measures are defined on page 101.
Defining Characteristics
Greencoat UK Wind PLC was designed for investors from first principles to be simple, transparent and low risk.
• The Group is invested solely in UK wind farms.
• Wind is the most mature and largest scale renewable technology.
• The UK has a long established regulatory regime, high wind resource and £80 billion worth of wind farms
in operation.
• The Group is wholly independent and thus avoids conflicts of interests in its investment decisions.
• The independent Board is actively involved in key investment decisions and in monitoring the efficient
operation of the assets, and works in conjunction with the most experienced investment management team
in the sector.
• Low gearing is important to ensure a high level of cash flow stability and higher tolerance to downside
sensitivities.
• The Group invests in sterling assets and thus does not incur material currency risk.
G R E E N C O A T
U K W I N D
01
I am pleased to present the Annual Report of
Greencoat UK Wind PLC for the year ended
31 December 2021.
Performance
2021 was another significant year of growth for the
Company with £570 million invested and £648 million
of new equity raised.
During the year, portfolio generation was low, 20 per
cent below budget, at 2,933GWh. Power prices were
significantly above budget, primarily reflecting high
gas prices in the second half of the year. Net cash
generated by the Group and wind farm SPVs was
£256.8 million, providing cover of 1.9x on
£138.8 million of dividends paid in the year.
By the end of 2021, the portfolio was generating
sufficient electricity to power 1.5 million homes and
avoiding carbon dioxide emissions of approximately
1.7 million tonnes per annum through the displacement
of thermal generation.
Dividends and Returns
Declared dividends for the year total 7.18 pence per
share, with the fourth and final quarterly dividend of
1.795 pence per share to be paid on 25 February 2022.
With our continuing strong cash flow and robust
dividend cover we can confidently target a dividend of
7.72 pence per share with respect to 2022, increased
in line with December’s RPI of 7.5 per cent.
NAV per share increased from 120.4 pence per share
(ex dividend) on 31 December 2020 to 131.7 pence
per share (ex dividend) on 31 December 2021, an
increase of 11.3 pence (9.4 per cent) during the year,
primarily reflecting high short term power prices. Since
listing, NAV has increased by more than RPI, as can be
seen on the chart on page 16.
The Total Shareholder Return for the year was
10.7 per cent.
Acquisitions
2021 has been an active investment year for us. In
February, we acquired the remaining 50 per cent
shareholding in Braes of Doune wind farm for
£48 million. In September, we acquired Andershaw
wind farm for £121 million and commissioned Douglas
West wind farm (investing a further £25 million during
the year). In November, we invested £250 million in
Burbo Bank Extension wind farm and in December we
acquired Windy Rig and Glen Kyllachy wind farms once
commissioning had been completed for £55 million
and £59 million respectively. During the year, we have
also provided £11 million of construction finance to
Kype Muir Extension wind farm (target commissioning
in Q4 2022).
Douglas West, Windy Rig and Glen Kyllachy are the
Company’s first 3 subsidy free projects and sit
alongside Burbo Bank Extension and Tom nan Clach,
the Company’s 2 CFD projects. The remaining 38 wind
farms are all accredited under the ROC regime. The
Group’s offshore fleet accounts for 33 per cent of
assets by value.
Equity Issuance
In order to finance our continuing growth and pursue
value creating opportunities, we issued 151 million
new shares on 19 February 2021 at a price of
131 pence per share, raising gross proceeds of
£198 million. On 29 November 2021 we issued a
further 341 million new shares at a price of 132 pence
per share, raising gross proceeds of £450 million. Both
equity raises were oversubscribed and priced at a
premium to NAV per share.
Gearing
In November, the Company’s revolving credit facility
was increased to £600 million. £150 million term debt
maturing in 2022 was also refinanced with longer
dated term debt with existing lenders. In December,
we entered into a new £200 million term debt facility
with AXA, which was utilised on 31 January 2022 to
reduce borrowings under the revolving credit facility
to £50 million (£250 million as at 31 December 2021).
Longer term borrowing, now totalling £900 million,
consists of various maturities to 31 January 2030, thus
reducing financing risk. The Group’s gearing of
£950 million as at 31 December 2021 equates to
23 per cent of GAV and the weighted average cost of
borrowing is 2.6 per cent.
Chairman’s Statement
Greencoat UK Wind PLC Annual Report for the year ended 31 December 2021
02
03
G R E E N C O A T
U K W I N D
Gearing continued
The Group will generally avoid using non-recourse
debt at wind farm level and aims to keep overall Group
level borrowings at a prudent level (the maximum is
40 per cent of GAV). Over the medium term we would
expect gearing to be between 20 and 30 per cent
of GAV.
Strategy and Outlook
Wind continues to be the most mature and widely
deployed renewable energy technology in the UK. In
November 2021, the UK hosted the COP26
conference in Glasgow, with the Prime Minister playing
a clear role in encouraging the delivery of 2050 net
zero emissions targets. A key part of that plan for the
UK is a 40GW offshore wind target for 2030.
Our Investment Objective has remained unchanged
over the last 9 years since listing: to provide
shareholders with an annual dividend that increases in
line with RPI inflation while preserving the capital value
of the investment portfolio in real terms. This is
achieved through a focused strategy of investing only
in wind farms and only in the UK and maintaining a
balanced exposure to power prices. Our intention
remains to adhere strictly to this core strategy.
Growth by acquisition brings benefits to shareholders
as:
• a larger scale brings economies and enables
better terms to be obtained from suppliers;
• equity raisings following acquisitions provide
additional opportunity for shareholders to increase
their investment in the Company;
• these equity raisings are priced at a premium to
NAV per share thus enhancing overall NAV per
share for existing shareholders; and
• equity raisings increase the liquidity of shares in
the market (during 2021 on average 14.1 million
of the Company’s shares were traded weekly on
the London Stock Exchange).
Significantly, during 2021 we made £570 million of
investments, of which 30 per cent were in ROC
accredited wind farms, 44 per cent in CFD projects and
26 per cent in subsidy free projects. We expect to
continue to see attractive CFD and subsidy free assets
within our significant acquisition pipeline alongside
wind farms accredited under the ROC regime.
The executive management continues to maintain a
disciplined acquisition strategy: if a potential investment
is not in line with the Company’s investment objectives,
or is otherwise not in the interests of shareholders, then
we will not invest.
Through strong cash flow and robust dividend cover,
coupled with our disciplined approach, we are
confident in our ability to continue to meet the
objectives of dividend growth in line with RPI and
capital preservation in real terms.
Health, Safety and the Environment
As a responsible investor in operating wind farms, the
Company takes its Health and Safety responsibilities very
seriously. We work with our Investment Manager to
promote the highest standard of health, safety and
environmental management practices in managing our
portfolio of investments. Detailed key performance
indicators and the results of audits are regularly reviewed
by the Board and action taken where necessary. We
continue to monitor the standards maintained by the
operators of our wind farm investments to ensure that
these are at least in line with the wider industry, while
seeking continuous improvement.
Climate Change
As a Company investing in wind farms, our strategy
and activities naturally make a positive contribution
toward the worldwide goal of achieving a net zero
carbon emissions economy and limiting global
warming to 1.5°C. We welcome the opportunity to
make appropriate climate related financial disclosures
as recommended by the Task Force on Climate-
Related Financial Disclosures (TCFD) in this year’s
Annual Report, which may be developed further in
future reports. Detailed disclosures can be found in the
Strategic Report on pages 31 to 33.
The Board and Governance
At the AGM, Willy Rickett will retire from the Board
and I, on behalf of the whole Board, would like to thank
him for the fine job he has done as the Company’s
Senior Independent Director since its listing in 2013.
Given his experience, Willy has been a great source of
wisdom and we have valued his contribution
enormously. We were delighted that Nick Winser
joined the board on 1 January 2022, bringing the
experience he has in the regulated electricity sector.
The annual internal evaluation of the Board raised no
significant issues.
The Group’s governance is further described in the
Corporate Governance Report on pages 45 to 49.
Chairman’s Statement continued
Humber Gateway
Chairman’s Statement continued
Annual General Meeting
Our AGM will take place at 2 pm on 28 April 2022 at
the office of the Investment Manager. In 2021,
following the advice of the government on social
distancing, travel and measures to prohibit public
gathering in order to minimise the spread of
COVID-19, the Company decided to change the
location of its AGM from the offices of the Investment
Manager and hold it with the minimum necessary
quorum of 2 shareholders present. A recording of the
AGM was made and is available for shareholders on
the Company’s website (www.greencoat-ukwind.com).
It is possible that such an arrangement might also be
either necessary or sensible for the AGM at the end of
April 2022. The Company realises that this is not ideal
and will try to provide the opportunity for investors to
meet with the Board and executive management, if
possible, later in the year, if the AGM has to be carried
out in this manner.
Details of the formal business of the meeting are set
out in a separate circular which is sent to shareholders
with the Annual Report.
Shonaid Jemmett-Page
Chairman
23 February 2022
Greencoat UK Wind PLC Annual Report for the year ended 31 December 2021
04
05
G R E E N C O A T
U K W I N D
The Investment Manager
The investment management team’s experience covers wind farm investment, ownership, finance and
operation. All the skills and experience required to manage the Group’s investments lie within a single
investment manager. The Investment Manager is authorised and regulated by the Financial Conduct Authority
and is a full scope UK AIFM.
Since the Company’s listing in March 2013, the investment management team has been led by Stephen Lilley
and Laurence Fumagalli.
Stephen has 25 years of investment management and financing experience in addition to 6 years in the nuclear
industry. Prior to joining the Investment Manager in March 2012, Stephen led the renewable energy infrastructure
team at Climate Change Capital (CCC) from May 2010. Prior to CCC, he was a senior director of Infracapital
Partners LP, M&G’s European Infrastructure fund. During this time, Stephen led the acquisitions of stakes in Kelda
Group (Yorkshire Water), Zephyr (wind farms) and Meter Fit (gas/electricity metering) and also sat on the boards
of these companies after acquisition. Prior to this, he was a director at Financial Security Assurance, where he led
over £2 billion of underwritings in the infrastructure and utility sectors. He also worked for the investment
companies of the Serco and Kvaerner Groups.
Laurence also has 25 years of investment management and financing experience. Prior to joining the Investment
Manager in March 2012, Laurence held a number of senior roles within CCC from 2006 to 2011. Initially he
co-headed CCC’s advisory team before transferring in 2007 to the carbon finance team. Laurence joined Stephen
in the renewable energy infrastructure team in early 2011. From 2003-2006, Laurence headed the Bank of
Tokyo-Mitsubishi’s London-based renewables team, where he financed and advised on over 1GW of UK wind.
Prior to the Bank of Tokyo-Mitsubishi, Laurence worked in the power project finance team at NatWest.
In December, Schroders plc announced that it had reached agreement to acquire a 75 per cent interest in the
Investment Manager. The transaction is expected to complete in H1 2022 subject to regulatory approval. The
Investment Manager will continue to operate as an independent business and will become part of Schroders
Capital, the private markets division of Schroders plc. Schroders plc is a global asset manager and wealth manager,
which delivers a broad range of investments for institutions, intermediaries and high net worth individuals with
AUM of £700 billion.
Investment Manager’s Report
Investment Manager’s Report continued
06
Greencoat UK Wind PLC Annual Report for the year ended 31 December 2021
Investment Portfolio
Operating portfolio as at 31 December 2021:
Total Ownership Net
Wind Farm Turbines Operator PPA MW Stake MW
Andershaw Vestas Statkraft Statkraft 35.0 100% 35.0
Bicker Fen Senvion EDF EDF 26.7 80% 21.3
Bin Mountain GE SSE SSE 9.0 100% 9.0
Bishopthorpe Senvion BayWa Axpo 16.4 100% 16.4
Braes of Doune Vestas BayWa Centrica 72.0 100% 72.0
Brockaghboy Nordex SSE SSE 47.5 100% 47.5
Burbo Bank Extension Vestas Orsted CFD 258.0 15.7% 40.4
Carcant Siemens BayWa Axpo 6.0 100% 6.0
Church Hill Enercon Energia Energia 18.4 100% 18.4
Clyde Siemens SSE SSE 522.4 28.2% 147.3
Corriegarth Enercon BayWa Centrica 69.5 100% 69.5
Cotton Farm Senvion BayWa Sainsbury’s 16.4 100% 16.4
Crighshane Enercon Energia Energia 32.2 100% 32.2
Deeping St. Nicholas Senvion EDF EDF 16.4 80% 13.1
Douglas West Vestas Natural Power Erova 45.0 100% 45.0
Drone Hill Nordex BayWa Statkraft 28.6 51.6% 14.8
Dunmaglass GE SSE SSE 94.0 35.5% 33.4
Earl’s Hall Farm Senvion BayWa Sainsbury’s 10.3 100% 10.3
Glass Moor Senvion EDF EDF 16.4 80% 13.1
Glen Kyllachy Nordex Natural Power Tesco 48.5 100% 48.5
Humber Gateway Vestas RWE RWE 219.0 37.8% 82.8
Kildrummy Enercon BayWa Sainsbury’s 18.4 100% 18.4
Langhope Rig GE Natural Power Centrica 16.0 100% 16.0
Lindhurst Vestas RWE RWE 9.0 49% 4.4
Little Cheyne Court Nordex RWE RWE 59.8 41% 24.5
Maerdy Siemens BayWa Statkraft 24.0 100% 24.0
Middlemoor Vestas RWE RWE 54.0 49% 26.5
North Hoyle Vestas RWE Erova 60.0 100% 60.0
North Rhins Vestas BayWa E.ON 22.0 51.6% 11.4
Red House Senvion EDF EDF 12.3 80% 9.8
Red Tile Senvion EDF EDF 24.6 80% 19.7
Rhyl Flats Siemens RWE RWE 90.0 24.95% 22.5
Screggagh Nordex SSE Energia 20.0 100% 20.0
Sixpenny Wood Senvion BayWa Statkraft 20.5 51.6% 10.6
Slieve Divena Nordex SSE SSE 30.0 100% 30.0
Slieve Divena II Enercon SSE SSE 18.8 100% 18.8
Stronelairg Vestas SSE SSE 227.7 35.5% 80.9
Stroupster Enercon BayWa BT 29.9 100% 29.9
Tappaghan GE SSE SSE 28.5 100% 28.5
Tom nan Clach Vestas Natural Power CFD 40.0 75% 30.0
Walney Siemens Orsted Total 367.2 25.1% 92.2
Windy Rig Vestas Statkraft Statkraft 43.2 100% 43.2
Yelvertoft Senvion BayWa Statkraft 16.4 51.6% 8.5
Total 1,422.0
07
G R E E N C O A T
U K W I N D
Investment Manager’s Report continued
Investment Portfolio continued
1 Andershaw
2 Bicker Fen
3 Bin Mountain
4 Bishopthorpe
5 Braes of Doune
6 Brockaghboy
7 Burbo Bank Extension
8 Carcant
9 Church Hill
10 Clyde
11 Corriegarth
12 Cotton Farm
13 Crighshane
14 Douglas West
15 Deeping St. Nicholas
16 Drone Hill
17 Dunmaglass
18 Earl’s Hall Farm
19 Glass Moor
20 Glen Kyllachy
21 Humber Gateway
22 Kildrummy
23 Langhope Rig
24 Lindhurst
25 Little Cheyne Court
26 Maerdy
27 Middlemoor
28 North Hoyle
29 North Rhins
30 Red House
31 Red Tile
32 Rhyl Flats
33 Screggagh
34 Sixpenny Wood
35 Slieve Divena
36 Slieve Divena II
37 Stronelairg
38 Stroupster
39 Tappaghan
40 Tom nan Clach
41 Walney
42 Windy Rig
43 Yelvertoft
24
27
8
5
12
18
25
2
15
19
30
31
35
3
22
11
26
7
40
16
29
34
43
38
33
23
4
39
9
13
6
20
37
36
41
21
32
28
42
17
14
1
10
Investment Manager’s Report continued
08
Greencoat UK Wind PLC Annual Report for the year ended 31 December 2021
Investment Portfolio continued
Breakdown of operating portfolio by value as at 31 December 2021:
Onshore/Offshore Geography
Asset Age Turbine Manufacturer
Assets
Humber Gateway (13%)
Walney (10%)
Burbo Bank Extension (6%)
Brockaghboy (4%)
Dunmaglass (3%)
Other (34%)
Clyde (10%)
Stronelairg (8%)
Corriegarth (5%)
Tom nan Clach (4%)
Braes of Doune (3%)
< 5 years (40%)
> 10 years (24%)
5-10 years (36%)
Vestas (44%)
Siemens (23%)
Enercon (12%)
Nordex (9%)
Senvion (6%)
GE (6%)
Onshore (67%)
Offshore (33%)
Scotland (46%)
England (38%)
Northern Ireland (11%)
Wales (5%)
09
G R E E N C O A T
U K W I N D
Portfolio Performance
Portfolio generation for the year was 2,933GWh, 20 per cent below budget.
The following table shows wind speed and portfolio generation relative to budget since listing:
UK weighted average wind speed Generation
(variation to long term mean) (variation to budget)
2013 (adjusted) +3% +8%
2014 -2% -3%
2015 +5% +8%
2016 -6% -6%
2017 -1% 0%
2018 -4% -6%
2019 -8% -11%
2020 +2% -3%
2021 -12% -20%
Variation to budget lies within reasonable statistical parameters. The annual standard deviation of wind speed is
6 per cent and the annual standard deviation of generation is 10 per cent (less than 2 per cent over 30 years).
2021 saw very low wind speeds of 2 standard deviations below the mean. Similar conditions were last seen
in 2010.
Investment Manager’s Report continued
Burbo Bank Extension
Investment Manager’s Report continued
10
Greencoat UK Wind PLC Annual Report for the year ended 31 December 2021
Portfolio Performance continued
The following table provides a breakdown of generation by wind farm:
Annual 2021 2021
Ownership Ownership Budget Budget Actual
Wind Farm Stake Period (GWh) (GWh) (GWh) Variance
Andershaw 100% Oct – Dec 105.5 31.6 26.3
(2)
-17%
Bicker Fen 80% Jan – Dec 44.3 44.3 39.3 -11%
Bin Mountain 100% Jan – Dec 23.2 23.2 17.8 -23%
Bishopthorpe 100% Jan – Dec 50.6 50.6 43.1 -15%
Braes of Doune 100%
(1)
Jan – Dec 167.8 151.0 118.9
(2)
-21%
Brockaghboy 100% Jan – Dec 156.0 140.4
(3)
109.0 -22%
Burbo Bank Extension 15.7% Dec 155.0 15.5 14.4 -7%
Carcant 100% Jan – Dec 17.1 17.1 14.5 -15%
Church Hill 100% Jan – Dec 37.1 37.1 29.8 -20%
Clyde 28.2% Jan – Dec 446.9 446.9 342.4
(2)
-23%
Corriegarth 100% Jan – Dec 216.2 216.2 150.3
(2)
-30%
Cotton Farm 100% Jan – Dec 51.0 51.0 43.1 -16%
Crighshane 100% Jan – Dec 59.7 59.7 49.2 -18%
Deeping St. Nicholas 80% Jan – Dec 29.6 29.6 26.6 -10%
Douglas West 100% Oct – Dec 129.2 38.8 33.9 -12%
Drone Hill 51.6% Jan – Dec 30.3 30.3 25.4 -16%
Dunmaglass 35.5% Jan – Dec 129.9 129.9 92.0
(2)
-29%
Earl’s Hall Farm 100% Jan – Dec 31.9 31.9 27.9 -12%
Glass Moor 80% Jan – Dec 28.8 28.8 24.1 -16%
Glen Kyllachy 100% n/a 145.7 ———
Humber Gateway 37.8% Jan – Dec 320.4 320.4 281.5 -12%
Kildrummy 100% Jan – Dec 55.6 55.6 40.6 -27%
Langhope Rig 100% Jan – Dec 46.7 46.7 39.1 -16%
Lindhurst 49% Jan – Dec 11.5 11.5 9.6 -16%
Little Cheyne Court 41% Jan – Dec 61.0 61.0 51.1 -16%
Maerdy 100% Jan – Dec 63.1 63.1 50.1 -21%
Middlemoor 49% Jan – Dec 68.3 68.3 51.9 -24%
North Hoyle 100% Jan – Dec 185.8 172.0
(4)
135.3 -21%
North Rhins 51.6% Jan – Dec 37.8 37.8 33.4
(2)
-12%
Red House 80% Jan – Dec 21.8 21.8 19.8 -9%
Red Tile 80% Jan – Dec 42.0 42.0 37.3 -11%
Rhyl Flats 24.95% Jan – Dec 70.3 70.3 62.8 -11%
Screggagh 100% Jan – Dec 44.3 44.3 35.6 -20%
Sixpenny Wood 51.6% Jan – Dec 28.5 28.5 22.3 -22%
Slieve Divena 100% Jan – Dec 54.9 54.9 42.4 -23%
Slieve Divena II 100% Jan – Dec 48.7 48.7 41.9 -14%
Stronelairg 35.5% Jan – Dec 302.6 302.6 226.7
(2)
-25%
Stroupster 100% Jan – Dec 94.9 94.9 75.1 -21%
Tappaghan 100% Jan – Dec 68.0 68.0 53.2 -22%
Tom nan Clach 75% Jan – Dec 121.8 121.8 103.1
(2)
-15%
Walney 25.1% Jan – Dec 355.6 355.6 274.8 -23%
Windy Rig 100% n/a 138.5 ———
Yelvertoft 51.6% Jan – Dec 21.7 21.7 17.1 -21%
Total 4,319.3 3,685.2 2,932.6 -20%
(1)
Ownership in Braes of Doune was 50 per cent until incremental acquisition of the remaining 50 per cent in February 2021.
(2)
Includes curtailed generation.
(3)
Brockaghboy 2021 budget reduced to reflect a scheduled grid outage.
(4)
North Hoyle 2021 budget reduced to reflect a scheduled grid outage and planned downtime for insulator exchanges.
Portfolio Performance continued
Notable issues affecting portfolio availability were:
• a scheduled grid outage at Brockaghboy to connect a nearby substation meaning that the wind farm was
offline for the whole of November;
• a scheduled grid outage at North Hoyle in April and May, planned downtime for insulator exchanges in
March and an export cable fault in July;
• various unplanned outages at Corriegarth and Kildrummy, with extended periods of downtime due to adverse
weather conditions and a shortage of operation and maintenance personnel;
• a shortage of operation and maintenance personnel at Dunmaglass, which delayed the resolution of certain
turbine faults; and
• an inter-turbine array cable fault at Stronelairg in September and remedial blade works in September
and October.
In general, we have reflected an increased allowance for grid outages when budgeting wind farm availability.
Grid outages are typically uncompensated and result in a whole wind farm being offline. The increased occurrence
in part relates to grid enhancement works to accommodate the further deployment of wind generation.
We have also reflected an increased allowance for curtailment in Northern Ireland. In contrast to curtailment
under the Balancing Mechanism in Great Britain, curtailment in Northern Ireland is uncompensated. The higher
rate of curtailment in part relates to the greater deployment of wind generation.
During the year, BayWa acquired part of the operational management business of DNV-GL, which included
Operational Management Agreements at Braes of Doune, Carcant, Maerdy and North Rhins. BayWa now
operates 13 sites in the Group’s portfolio.
New PPAs have been entered into with: (i) Erova at Braes of Doune (from July 2022, power only), Douglas West
(power only) and North Hoyle (power only); (ii) Total at Braes of Doune (from July 2022, ROCs only), Carcant
(ROCs only), North Hoyle (ROCs only) and Walney; and (iii) Tesco at Glen Kyllachy.
Health and Safety
Health and safety is of key importance to both the Company and the Investment Manager.
The Investment Manager is an active member of SafetyOn, the UK’s leading health and safety focused
organisation for the onshore wind industry. The Investment Manager also has its own health and safety forum,
chaired by Stephen Lilley, where best practice is discussed and key learnings from incidents from across the
industry are shared.
During the year, routine health and safety audits were conducted across 11 sites by an independent consultant.
In addition, the Investment Manager undertook 38 safety walks. No material areas of concern were identified
from all audits and safety walks performed in the year.
11
G R E E N C O A T
U K W I N D
Investment Manager’s Report continued
Investment Manager’s Report continued
12
Greencoat UK Wind PLC Annual Report for the year ended 31 December 2021
Acquisitions
During the year, the Investment Manager priced 20 wind farms totalling 1,286MW. Of the 20 wind farms priced,
3 investments were made by the Group (Braes of Doune, Andershaw and Burbo Bank Extension), 2 were acquired
by other buyers, 8 are no longer being pursued by the Group, and 7 are subject to continuing discussions. In total,
there were 9 relevant secondary market transactions in the UK wind sector in 2021.
The following table lists investments in the year to 31 December 2021:
£m
Douglas West 25.3
Kype Muir Extension 10.6
Braes of Doune 48.1
Andershaw 121.2
Burbo Bank Extension 250.0
Windy Rig 55.1
Glen Kyllachy 59.5
Total 569.8
During the year, the Group funded incremental investment of £25.3 million in the 45MW Douglas West subsidy
free wind farm project, which entered into full commercial operation in September 2021.
During the year, the Group also provided £10.6 million of construction finance to the Kype Muir Extension
subsidy free wind farm project (target commissioning in Q4 2022).
On 23 February 2021, the Group acquired the remaining 50 per cent interest in Braes of Doune wind farm from
Hermes for £48.1 million. The Group has been invested in this wind farm since listing and the wind farm receives
1 ROC per MWh.
On 27 September 2021, the Group acquired the 35MW Andershaw wind farm from Statkraft for £121.2 million.
The wind farm receives 0.9 ROCs per MWh.
On 30 November 2021, the Group acquired a net 15.7 per cent stake in the 258MW Burbo Bank Extension
offshore wind farm from AIP for £250 million. The wind farm benefits from a CFD priced at £176.57/MWh
(real 2021).
On 14 December 2021, the Group acquired the 43.2MW Windy Rig subsidy free wind farm from Statkraft for
£55.1 million and on 22 December 2021, the Group acquired the 48.5MW Glen Kyllachy subsidy free wind farm
from RWE for £59.5 million.
The acquisition of the 37.8MW Twentyshilling subsidy free wind farm from Statkraft for £51.4 million is expected
to complete in March 2022.
The agreements to acquire Windy Rig, Glen Kyllachy and Twentyshilling were all entered into in 2019.
Equity Issuance
On 19 February 2021, the Company issued 151 million new shares at a price of 131 pence per share, raising gross
proceeds of £198 million. On 29 November, the Company issued a further 341 million new shares at a price of
132 pence per share, raising gross proceeds of £450 million.
13
G R E E N C O A T
U K W I N D
Gearing
In November, the Company’s revolving credit facility was increased to £600 million. Term debt maturing in 2022
was also refinanced with longer dated term debt. In December, the Company entered into a new £200 million
term debt facility with AXA, which was utilised on 31 January 2022 to reduce borrowings under the revolving
credit facility to £50 million (£250 million as at 31 December 2021).
The Group’s gearing of £950 million as at 31 December 2021 equates to 23 per cent of GAV (limit 40 per cent).
All borrowing is at Company level (no debt at wind farm level). More detail in relation to the Group’s debt
facilities can be found in note 13 to the financial statements.
Financial Performance
Power prices during the year were well above budget, primarily reflecting high gas prices. The average N2EX
Day Ahead auction price was £117.43/MWh (2020: £35.23/MWh).
Net cash generated by the Group and wind farm SPVs was £256.8 million, providing cover of 1.9x dividends paid
during the year, with low generation being more than offset by high power prices.
Cash balances (Group and wind farm SPVs) increased by £23.3 million to £117.1 million over the year.
Investment Manager’s Report continued
Douglas West
Investment Manager’s Report continued
14
Greencoat UK Wind PLC Annual Report for the year ended 31 December 2021
Financial Performance continu ed
For the year ended
31 December 2021
Group and wind farm SPV cash flows £’000
Net cash generation
(1)
256,764
Dividends paid (138,786)
Acquisitions
(2)
(569,783)
Acquisition costs
(3)
(6,263)
Equity issuance 647,618
Equity issuance costs (9,715)
Net repayment under debt facilities (150,000)
Upfront finance costs (6,556)
Movement in cash (Group and wind farm SPVs) 23,279
Opening cash balance (Group and wind farm SPVs) 93,820
Closing cash balance (Group and wind farm SPVs) 117,099
Net cash generation 256,764
Dividends 138,786
Dividend cover 1.9x
(1)
Alternative Performance Measure as defined on page 101.
(2)
Includes £2,665k capital expenditure at Windy Rig and £1,160k working capital at Glen Kyllachy.
(3)
Includes £4,403k in relation to Humber Gateway, acquired in 2020.
The following 2 tables provide further detail in relation to net cash generation of £256.8 million:
For the year ended
31 December 2021
Net Cash Generation – Breakdown £’000
Revenue 457,933
Operating expenses (150,892)
Tax (30,445)
Other 23,489
Wind farm cash flow 300,085
Management fee (20,820)
Operating expenses (1,518)
Ongoing finance costs (24,420)
Other (641)
Group cash flow (47,399)
VAT (Group and wind farm SPVs) 4,078
Net cash generation 256,764
For the year ended
31 December 2021
Net Cash Generation – Reconciliation to Net Cash Flows from Operating Activities £’000
Net cash flows from operating activities
(1)
242,261
Movement in cash balances of wind farm SPVs
(2)
26,366
Capital expenditure at Windy Rig and working capital at Glen Kyllachy
(2)
3,826
Repayment of shareholder loan investment
(1)
8,731
Finance costs
(1)
(30,976)
Upfront finance costs
(3)
6,556
Net cash generation 256,764
(1)
Consolidated Statement of Cash Flows.
(2)
Note 9 to the financial statements.
(3)
£6,375k facility arrangement fees plus £138k professional fees (note 13 to the financial statements) plus £43k movement in finance costs
payable (note 12 to the financial statements).
15
G R E E N C O A T
U K W I N D
Investment Performance
£’m
NAV at 31 December 2020 2,229.9
Investment 569.8
Movement in portfolio valuation 116.6
Movement in cash (Group and wind farm SPVs) 23.3
Movement in other relevant assets/liabilities 4.1
Movement in Aggregate Group Debt 150.0
NAV at 31 December 2021 3,093.7
The increase in the portfolio valuation of £116.6 million equates to approximately 5 pence per share, which can
be further broken down as follows: +14 pence from an increase in forecast power prices, +2 pence from an
increase in inflation assumptions, -5 pence from an increase in the corporation tax rate (25 per cent modelled from
2023 onwards), and -6 pence attributable to depreciation and other assumption changes.
Total dividends of £138.8 million were paid in 2021. Total dividends of £148.0 million have been paid or declared
with respect to 2021 (7.18 pence per share). The target dividend with respect to 2022 is 7.72 pence per share
(increased in line with December 2021 RPI).
NAV at
31 December
2020
Investment
Movement in
portfolio
valuation
Movement in
cash (Group and
wind farm SPVs)
Movement in
other relevant
assets/liabilities
Movement in
Aggregate
Group Debt
NAV at
31 December
2021
Shares in issue
2,317,097,822
NAV/share (pence)
133.5
£m
1,824,129,348
122.2
0.0
500.0
1,000.0
1,500.0
2,000.0
2,500.0
3,000.0
3,500.0
Investment Manager’s Report continued
Investment Performance continued
pence per share per cent
NAV at 31 December 2020 122.2
Less February 2021 dividend (1.8)
NAV at 31 December 2020 (ex dividend) 120.4
NAV at 31 December 2021 133.5
Less February 2022 dividend (1.8)
NAV at 31 December 2021 (ex dividend) 131.7
Movement in NAV (ex dividend) 11.3 9.4
Dividends with respect to the year 7.2 6.0
Total return on NAV 18.5 15.4
The chart below shows NAV per share versus RPI:
NAV vs RPI
The chart below shows TSR versus market peers:
Total Shareholder Return vs Market Peers (Bloomberg)
Greencoat UK Wind
Bluefield Solar
Income Fund
The Renewables
Infrastructure Group
Foresight Solar Fund
John Laing Environmental
Assets Group
Next Energy
Solar Fund
90
110
130
150
170
190
210
230
%
Dec
2020
Dec
2013
Dec
2014
Dec
2015
Dec
2016
Dec
2017
Dec
2018
Dec
2019
Dec
2021
RPI (rebased to 98)
NAV per share (ex dividend)
136
132
128
124
120
116
112
108
104
100
96
Dec
2013
Dec
2014
Dec
2015
Dec
2017
Dec
2016
Pence
Dec
2018
Dec
2019
Dec
2020
Dec
2021
Investment Manager’s Report continued
16
Greencoat UK Wind PLC Annual Report for the year ended 31 December 2021