bp and EnBW celebrate 3GW Round 4 win

In: Windfarms
08/02/2021
bp

bp and Energie Baden-Wuerttemberg AG (EnBW) of Germany have together been selected as the preferred bidder for two major leases in the UK Offshore Wind Round 4.

The leases, both located in the Irish Sea, offer a combined potential generating capacity of 3 GW, the maximum award possible under the rules of the round, and a 60-year lease life. Once operational, this generating capacity would be sufficient to power more than 3.4 million UK households with clean electricity.  

bp and EnBW intend to form a 50-50 joint venture to jointly develop and operate the leases.  The joint venture expects to make four annual payments of £231 million on each lease before projects reach final investment decision. Projects are expected to be operational in seven years.  

According to the project partners, the two leases feature strong wind resources and their proximity to shore make them attractive investment opportunities. Their near-shore location, around 30 kilometres off the coast of North West England and North Wales, will allow for lower cost, more reliable transmission infrastructure. Their shallow water depths of 35-40 metres are also expected to support efficient and cost-effective development.  

Lease one covers an area of c.300km2 and lease two c.500km2. As they are adjacent, projects are expected to benefit from significant synergies in procurement, development and operational costs.


"Offshore wind is integral to delivering the UK’s green industrial revolution. Building on the UK’s strengths, the government’s 10-point plan aims to produce enough offshore wind to power every UK home, quadrupling output to 40GW by 2030 – and bp is delighted to play a part in this,"
commented Bernard Looney, group chief executive.

“Success in this round marks bp’s entry into one of the world’s best offshore wind markets. This is both important progress towards bp’s transformation into an integrated energy company as well as a significant next step in our long history in the UK.  

“These projects – in which we are teaming up with an experienced partner EnBW - are absolutely in line with our determination to invest with discipline into only the very best opportunities. We are fully confident that these highly advantaged resources will deliver - at a minimum - the 8-10% returns we demand of our renewables investments.  

“Additionally – offshore wind is integral to delivering the UK’s green industrial revolution. Building on the UK’s strengths, the government’s 10-point plan aims to produce enough offshore wind to power every UK home, quadrupling output to 40GW by 2030 – and bp is delighted to play a part in this.”  


Frank Mastiaux, chief executive of EnBW, commented: “We are delighted with this auction win in a tough international bidder field. The award confirms that bp and EnBW are the right partners with the right strategy and the right capabilities. EnBW is among today’s leaders in advanced offshore wind technology. In partnership with bp, a major player with international experience in the offshore business, we will once again contribute significantly to a climate-friendly energy future in the UK, which is currently the world’s largest market for offshore wind power.”  

bp and EnBW have already started some pre-work activities, including collection of vital environmental data through bird surveys – an integral part of biodiversity requirements – and have applied for grid connection.  

The Crown Estate will undertake a Plan-Level Habitats Regulations Assessment (HRA) of the Round 4 leasing plan, and subject to the outcome of the HRA, agreements for leases are expected by Spring 2022.  


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