We talk to EKF's new CEO Kirstine Damkjaer

“I’m in the process of moving back from the US, so there is a lot of activity here.”

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This is no small undertaking for Kirstine Damkjaer, who left Denmark in 2000 and has since spent 19 years in the US working in various roles within the World Bank Group. She has now returned to her home country after almost two decades to be CEO of its export credit agency EKF.

It is a homecoming in more ways than one.

Damkjaer was previously an underwriter at EKF between 1997 and 2000, and she says it is an exciting time to return. The company reported its 2018 results in April, and revealed that last year was the busiest in its 97-year history as it booked new guarantees and loans worth €4.5bn with profits of €82.7m. This makes it the biggest publicly-backed financiers of wind deals in the world, and growing calls for climate action should support its deals pipeline in coming years.

A Word About Wind spoke to Damkjaer for the first time since taking over the CEO role in February. She discussed the areas of the wind sector where EKF is set to focus its investments in the coming years; the company’s recent blockbuster wind deals, including providing €600m of guarantees to Ørsted at the 1.2GW Hornsea 1; and how her experience from the World Bank Group should shape her approach.

She says activism calling for action from politicians and businesses on the climate emergency is set to support growth in the wind industry.
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“Our goals are not hidden, in that you do have a very pressing agenda around climate, and wind and other renewable energy sources are poised to play a huge role in supporting that agenda,” she says. “I think that positions EKF, and wind, quite well in the whole mix.”

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Wind investment strategy

EKF’s main goal is to support Danish exporters to grow globally. Its regular clients include turbine manufacturers such as Vestas and Siemens Gamesa, utilities such as Ørsted that are highly active on development, sub-suppliers through the supply chain, and foreign-headquartered companies with Danish operations.

For example, in March it issued a credit facility to Chinese turbine maker Envision, which has a global innovation centre in Denmark, that enables it to access funds from Spanish bank Santander to support its deals with Danish sub-suppliers.

Damkjaer says that its deals at Hornsea 1 and with Envision show two of the four main areas that the company is focusing its wind investment activities. First, it is supporting the growth of offshore wind in established markets, such as the North Sea, and Asia; and second, it is backing the growth plans of companies such as Envision that purchase a lot of products from Denmark.

The company is also focused on supporting the rollout of wind in emerging markets, in continents including Africa. EKF was a backer of the 310MW Lake Turkana project in Kenya that was linked to the grid last year; and it followed this by backing the 158MW Taiba N’Diaye project in Senegal by Lekela Power, which reached financial close last August. EKF’s involvement helped the developer secure long-term finance.

EKF has also recently closed a deal in Vietnam and is looking at the Americas.

And finally, its other big focus in wind is closer to home: Scandinavia. EKF supported Vattenfall, Vestas and PKA on development of the 353MW Blakliden Fabodberget project in Sweden, which reached financial closer last October.

“I think you’ll see lots of good deal flow coming from all over. The fact is that we are in Hornsea and all these other deals, and we are being seen as a go-to institution in the wind industry, and we’d like to continue to be seen as such,” she says. “That doesn’t mean that EKF would come in and finance every wind project that’s possible to build. We work strategically with our clients and support them to find solutions.”

She adds that the company also looks at deals in other renewables sectors, and is interested in how storage could further support growth of wind.‍

Supportive policy environment‍

While technological evolution and climate activism could support the expansion of wind, by pushing down costs and increasing political support, companies must be aware of the potential impacts that this could have. Damkjaer says these trends are causing problems for some companies it works with throughout the supply chain.

“Obviously, the end user wants to have the price as low as possible. That will hurt the sub-suppliers and the suppliers if the prices need to come down, and they have come down very much,” she says. “You need to have a good sustainable business for the people that are in the business, and so you can find that happy medium and sustain that whole agenda around climate change and keep the momentum.”

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This includes making sure governments have the policies that support renewables, as well as the right regulatory frameworks to make sure that deals happen. That is a particular concern in emerging markets where the legal system is also evolving.

Damkjaer is familiar with these risks. During her time at World Bank, she spent 15 years at the emerging-markets-focused International Finance Corporation, including most recently as its global industry head of equity: “Luckily, I come from investing in emerging markets, so I think that’s my home turf – and so it continues,” she says.