Vineyard Wind, which is on track to be the first major U.S. offshore wind farm, closed on a $2.3 billion loan and will begin construction in Massachusetts later this year, its owners said on Wednesday.
The senior debt financing allows the project, a joint venture between Avangrid and Copenhagen Infrastructure Partners, to mobilize its contractors and suppliers to begin work, the companies said.
The U.S. government approved Vineyard Wind in May, billing it as the inauguration of a new domestic industry that will help eliminate emissions from the power sector, a critical pillar in President Joe Biden's climate change agenda.
“With the signing of these agreements, we now have everything in place to start construction, launching an industry that will immediately start to create jobs and make a significant contribution to meet Massachusetts' carbon pollution reduction targets," Lars Pedersen, chief executive of Vineyard Wind, said in a statement.
Construction will begin onshore in Barnstable, Massachusetts, in Cape Cod, later this year. Offshore work will start next year, and the project is expected to begin delivering power in 2023.
Vineyard Wind will be located 15 miles (24 kilometers) off the coast of Martha's Vineyard and is intended to create enough electricity to power 400,000 homes in New England.
Nine banks participated in the $2.3 billion in financing. They include Bank of America, J.P. Morgan, BBVA, NatWest, Credit Agricole, Natixis, BNP Paribas and MUFG Bank. The company was advised by Santander, which also invested in the project.
(Reporting by Nichola Groom; Editing by David Gregorio)