Norsk Hydro, one of Europe’s largest aluminium producers, has agreed to buy most of the electricity from an €800m wind farm in Sweden, highlighting the increasing importance of industrial energy users in driving uptake of renewable power.

Macquarie, the Australian bank financing the project with General Electric of the US, said it believed the deal was the biggest of its kind with a corporate energy consumer for wind power.

Power purchase agreements by large companies are well-established in the US, where technology groups including Apple, Facebook and Google have been prominent among those underwriting development of wind and solar projects.

The Norsk Hydro deal shows how the trend is also gaining momentum in Europe as companies respond to regulatory pressure and economic incentives to reduce their carbon emissions and embrace renewable power.

The Norwegian group has agreed to buy a fixed volume of electricity for 19 years from the 650 megawatt Markbygden wind farm, which will increase Swedish wind power capacity by more than 12 per cent.

Edward Northam, head of Green Investment Group, the Macquarie unit backing the project, said the deal would allow development of the largest single-site wind farm in Europe with minimal subsidies from the Swedish government.

This showed how corporate energy users were creating a new model for renewable investment as the falling cost of wind and solar power led governments around the world to reduce subsidies for green power, he added.

“Investors in long-term infrastructure assets are still looking for some revenue certainty and structures such as this one are going to fill the gap [as subsidies are withdrawn],” said Mr Northam. “It provides predictable cash flows for the investor and certainty for the corporate consumer on energy prices.”

Microsoft has recently announced two similar deals in Europe with commitments to buy all the output from two new wind farms in the Netherlands and Ireland with combined capacity of more than 200MW.

Technology companies have been among the trend leaders because of the heavy energy needs of their data centres and cloud computing services, often coupled with ambitious commitments to reduce their carbon footprints.

Energy-intensive manufacturers such as Norsk Hydro are also showing growing interest in underwriting renewable power projects as policy measures to tackle climate change increase the cost of carbon emissions in many parts of the world.

In the US and Mexico, companies have announced purchase agreements for more than 2 gigawatts of renewable power capacity so far this year, according to the Business Renewables Center in Colorado. That is equivalent to two nuclear reactors.

The Swedish project marks the first for Green Investment Group outside Britain since the former UK government-owned entity was acquired by Macquarie in August for £2.3bn. It was previously known as the Green Investment Bank with a remit to finance UK clean energy projects, but Macquarie is expanding its reach into Europe.

Macquarie and GE jointly acquired the Markbygden project from Svevind, a Swedish developer, and will jointly invest €300m, with a further €500m of debt finance from investors including the EU’s European Investment Bank. GE will supply 179 turbines for the wind farm and jointly operate it with Green Investment Group.

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