Originally, the consortium had planned to expand on the 630MW already installed in Phase 1, increasing its capacity to 1000MW in Phase 2.

However, the decision to scrap the expansion plans followed a review of the site, which established that “the technical challenges and the environmental uncertainties surrounding the site” would make the project unfeasible.

In a statement, consortium partner e.on said that it would take at least three years until Phase 2’s potential impact on birds could be completely assessed.

In addition, general manager Mike O’Hare said that the Phase 2 site is technically more challenging than Phase 1 because “a large area is in very shallow water”. Additional issues include a difficult and longer route for the export cables and an exclusion zone for aggregates operations.

O’Hare said: “Phase 2 has always been subject to a Grampian condition requiring London Array to demonstrate that any change caused by the additional turbines to the habitat of the Red Throated Divers that overwinter in this part of the Thames Estuary would not compromise its status as a designated environmental Special Protection Area”.

The consortium says that it will take until at least January 2017 for the data to be collected.

O’Hare said: “Although initial findings from the existing Phase 1 site look positive, there is no guarantee at the end of three years that we will be able to satisfy the authorities that any impact on the birds would be acceptable”.

London Array has formally requested that The Crown Estate terminate the agreement for lease for the Phase 2 area and has cancelled the remaining grid capacity it had reserved at the National Grid substation at Cleve Hill, Graveney, Kent.

“In the absence of any certainty that Phase 2 would be able to go ahead, our shareholders have decided to surrender The Crown Estate agreement for lease on the site, terminate the grid connection option, and concentrate on other development projects in their individual portfolios. Our existing operations at Ramsgate and staffing levels are unaffected,” added O’Hare.

The project consortium has the following shareholdings: DONG Energy owns 50%, E.ON has 30% and Masdar has 20%. The London Array was officially opened in June 2013.

Last month, DONG Energy signed an agreement to sell half of its 50% share in the London Array to Canadian financial institution, La Caisse, for £644m.

Leigh Stringer

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