Equinor to Develop Dogger Bank Offshore Wind Project
UK authorities announced today, 20 September, that Equinor and its partner SSE were awarded contracts to develop three large scale offshore wind projects in the Dogger Bank region of the North Sea. This will be the world’s biggest offshore windfarm development with a total installed capacity of 3.6GW.
The Dogger Bank windfarm will consist of three projects, Creyke Beck A, Creyke Beck B and Teesside A. The clearing prices for the projects are EUR 45.10 per MWh for Creyke Beck A and EUR 47.33 per MWh for the Creyke Beck B and the Teesside A projects (all in 2012 real prices). The auction results reflect the continued cost reductions and technological developments and the increasing competitiveness of bottom-fixed offshore wind. The contracts offer a fixed price for the first fifteen years of operation, providing the projects with a long-term predictable revenue stream.
“The successful bids for the world’s largest offshore wind development represent a game-changer for our offshore wind business and support the development of Equinor as a broad energy company. A full-scale development of Dogger Bank will constitute an industrial wind hub in the heart of the North Sea, playing a major role in the UK’s ambitions for offshore wind and supporting the net zero ambition. Excellent wind speeds, shallow waters and scale make Dogger Bank well positioned to deliver low cost renewable electricity to UK homes and businesses”, says Eldar Sætre, CEO of Equinor. Pål Eitrheim, Executive Vice President for New Energy Solutions of Equinor, adds, “Dogger Bank, together with the recent award for Empire Wind in the US, positions Equinor as an offshore wind major. These projects provide economies of scale and synergies, making us an even stronger competitive force in offshore wind globally. We expect the cost reductions obtained by the industry through continuous project execution and technological innovation will contribute to continued value enhancement.” “We are thrilled at the success of our offshore wind projects at Dogger Bank which combined will be the largest windfarm in the world. Reaching this point has been a culmination of over ten years of development and it is very exciting to work with Equinor on taking the project forward. We’re confident our wealth of offshore wind experience will enable us to deliver these unique projects. This success demonstrates that offshore wind is the key technology to enable the UK to become carbon neutral by 2050 in the most cost-effective way, whilst also delivering significant economic benefits across the country”, says Jim Smith, Managing Director of SSE Renewables.
The Dogger Bank projects are estimated to trigger a total capital investment of approximately EUR 10 billion between 2020 and 2026. The joint venture will be seeking non-recourse project financing to fund the Dogger Bank development. A preliminary market sounding of potential lenders has demonstrated very strong interest for UK offshore wind assets. The partners are planning for final investment decision for the first project during 2020 and first power generation is planned for 2023. Further phases of the Dogger Bank project will be developed thereafter. The joint venture has selected SSE as the lead operator during the project construction phase and Equinor the lead operator for operations. Both companies will second personnel into the execution and operations teams. The awards were given under the Contracts for Difference (CfD) competitive auction held by National Grid on behalf of the UK’s Department for Business, Energy and Industrial Strategy (BEIS) which has successfully commissioned 6GW of offshore wind to reach a target of 30GW of offshore wind by 2030.