Major offshore wind operator plans £6bn UK investment by 2020
Dong Energy, the biggest operator of offshore windfarms in Britain, has said it plans to spend a further £6bn in the UK by 2020, convinced that the government is serious about supporting wind power.
Vattenfall, another significant UK windfarm operator, says it too is “optimistic” about 2016 and is hoping to proceed with a turbine testing site off Scotland this summer.
The statements of intent are a major boost to Amber Rudd, the secretary of state for energy and climate change, who has been under fire for cutting subsidies to solar and other low-carbon sectors despite signing up to the Paris climate change accord.
Brent Cheshire, Dong’s UK division chairman, said he had harboured concerns about government policies as little as two months ago, but had since been reassured by recent firm commitments to offshore wind.
“It was a concern that it took as long as it did [for ministers to recommit to offshore wind] but we have now got it. I think there is the clarity we need to commitment to new investment,” he explained.
Cheshire said it made more sense for the government to back offshore wind than the Hinkley Point C nuclear power station, which was going to prove a lot more expensive.
But he also warned it would take time for companies to cut their offshore windfarm costs, and that hopes that this arm of the renewable sector could become subsidy-free as early as 2023 were “not realistic”.
Vattenfall has for years being trying to build a European offshore wind deployment centre off the Scottish coast in Aberdeenshire, but has faced legal opposition from American billionaire and Republican presidential hopeful, Donald Trump. The British supreme court has now ruled the project can go ahead.
The centre would allow the Swedish-based company behind windfarms in Thanet and Kentish Flats to experiment with different kinds of turbines to see which are the most cost-effective.
Vattenfall said it was upbeat about offshore wind after Rudd said last month she would support the industry as long as it brought costs down.
“We are optimistic about offshore wind and although we still think there may be potential investment opportunities onshore we are more cautious about that,” the Vattenfall spokesman said.
Denmark-based Dong has spent £6bn so far developing windfarms in Britain and now says it wants to double this amount in the next four years. This means pressing ahead with projects such as the giant Hornsea scheme off Yorkshire.
Once completed, this scheme will become the world’s first gigawatt-scale windfarm, 80 miles offshore. Hornsea’s 240 turbines are scheduled to commence electricity generation by 2020 with the capacity to power 800,000 homes.
Cheshire admitted that the intermittent nature of wind – and many other renewable energy technologies – meant back-up “baseload” generation was needed but said this did not need to come from nuclear but could come via interconnectors - electricity cables from abroad.
He also argued that offshore wind power was very predictable given the sophistication of modern weather forecasting systems.