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Green Investment Bank and ORE in collaboration

By: Tom Russell 17/09/2015 ORE Catapult edited by 4C Offshore

General

The Green Investment Bank and the Offshore Renewable Energy Catapult have today announced a three year agreement to work together to drive investment into offshore renewable energy through greater understanding and management of the associated risks, reducing the costs associated with producing energy from offshore renewables. They believe this to be achievable through reducing the costs associated with producing energy from offshore renewables.

The Memorandum of Understanding sets out how the two organisations will collaborate in order to lower the levelised cost of energy (LCOE). It identifies six areas on which they will initially work together, each aimed at addressing specific perceived risks in investment in offshore renewable projects:

· Standardisation of due diligence scopes for equity and debt investment
· Assessment and solutions for technical challenges on offshore structures
· Development of enabling technology standards, such as LiDAR
· Operations and maintenance certification development
· Industry accepted benchmarking/ stage-gating parameters for performance of both marine projects and technologies to enable investment/ financing
· Financial modelling best practice for offshore renewables projects

Each organisation will also benefit from direct access to the technical expertise of the other, avoiding the costs of developing non-core internal capability.

Business Minister Anna Soubry said: “This collaboration is a very positive step for our offshore wind industry – helping to increase business productivity, encourage green innovation and stimulate long-term growth.”

Green Investment Bank CEO Shaun Kingsbury said, “Our respective organisations support the offshore wind industry’s moves to reduce risks and cut costs. We believe that allying our financial expertise with ORE Catapult’s technical know-how will help achieve that aim.”

ORE Catapult CEO Andrew Jamieson said, “Joined up thinking between finance and technology is a major enabler of offshore renewable energy deployment.

“ORE Catapult and GIB together will ensure an industry better informed as to what’s investable and markets better able to assess and manage investments through understanding of technology.”

The capital intensity of offshore renewables makes the cost of capital a key driver of the cost of such energy. The Crown Estates’ Offshore Wind Cost Reduction Pathways Study, published in June 2012, estimates that a drop of one percentage point in the Weighted Average Cost of Capital (WACC) is equivalent to a reduction in the Levelised Cost of Energy (LCOE) of around 6%.

The UK Green Investment Bank's investments help fund the creation of new energy and waste infrastructure across the UK and with that, new jobs in construction and operations.

The Offshore Renewable Energy (ORE) Catapult is the UK's flagship technology innovation and research centre for offshore wind, wave and tidal energy. ORE is an independent, not-for-profit business that exists to accelerate the development of offshore wind, wave and tidal technologies.

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Green Investment Bank and ORE in collaboration

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