Thursday, June 20, 2024
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The Crown Estate seals landmark agreements for offshore wind energy to power 7 million homes

In a major milestone for the UK’s energy security and net zero commitments, The Crown Estate has announced it has signed Agreements for Lease for six offshore wind projects which could begin to generate green electricity by the end of the decade and have the potential to generate c.8GW of renewable electricity, enough for more than seven million homes.

Signing these agreements represents a significant moment in the UK’s response to climate change and energy security, and further bolsters the country’s thriving offshore wind industry, reinforcing its position as the second largest offshore wind energy generator in the world.

Three of the six projects are located off the North Wales, Cumbria and Lancashire coast, and three are located in the North Sea off the Yorkshire and Lincolnshire coast.

Following The Crown Estate’s final decision to proceed in August 2022, the agreements are the culmination of The Crown Estate’s Offshore Wind Leasing Round 4, adding further strength to the offshore wind sector’s track record in leading the UK’s net zero energy transition. Round 4 follows three previous leasing rounds by The Crown Estate which, along with investment in cutting-edge data and evidence and a commitment to increasing collaboration across sectors, has paved the way for the development of a world-class offshore wind market in the UK, with The Crown Estate having now awarded rights totalling 41GW.

With agreements signed, developers can now further progress their plans for the projects which have the potential to make a major contribution to delivering sustainable, renewable energy for the UK, as well as the Government’s target of 50GW of offshore wind capacity by 2030.

Dan Labbad, CEO of The Crown Estate, said: “The UK’s offshore wind achievements to date are nothing short of remarkable, and this next generation of projects point to an even more exciting and dynamic future.

“They demonstrate the far-reaching value that our world-class offshore wind sector can deliver for the nation: home grown energy for all, jobs and investment for communities, revenue for the taxpayer, clean energy for the benefit of the environment and a considerate, sustainable approach which respects our rich biodiversity.

“Moving forward, working with our stakeholders to continue unlocking this value is what drives us, and we are more committed than ever to lead the way in ensuring this important benefit is realised for our environment and for the nation.”

Gus Jaspert, Managing Director, Marine, at The Crown Estate, added: “Today marks a significant milestone for the UK on the road to net zero, unlocking green energy potential for more than seven million homes and demonstrating to the world that the UK offshore wind industry is growing at pace to help meet the climate challenge.

“As we face up to energy, climate and biodiversity challenges, we will continue to convene the best minds and support new technologies which will help realise the potential of the seabed as a key component of the UK’s renewable energy system; a home to a thriving natural environment; and a route to energy security.

“I’d like to thank all those who have collaborated with us on this leasing round to ensure the UK continues to lead the way in rebalancing energy provision away from fossil fuels for the benefit of present and future generations.”

Minister for Energy and Climate Graham Stuart said: “Britain’s position as the European leader in offshore wind shows no signs of letting up. These six projects demonstrate how areas across the UK can contribute to ensuring Britain meets its world-leading ambition of deploying up to 50GW of offshore wind by 2030.

“Offshore wind is at the heart of our goal to secure clean, affordable and resilient energy supply for all in the UK, while bringing major business, investment and job opportunities along with it.”

A pioneering approach to environmental habitats

The Crown Estate will now lead a pioneering programme of work to oversee the development of strategic environmental compensation plans for two protected sites, ensuring that the health of the natural marine environment remains at the centre of development plans.

The Crown Estate will establish a Steering Group for each of the protected sites, comprising government and statutory nature conservation bodies and the relevant project developers, which will drive the development of the detailed plans to ensure appropriate delivery of the commitments made by The Crown Estate through its plan-level HRA.

Offshore wind momentum

Recognising the urgent need for green, home-grown energy provision, The Crown Estate is committed to unlocking opportunities for emerging and new technologies which can help shape a UK energy system fit for the future, in line with government policy. Key to this is bringing together a wide range of partners, experts, insights, data and evidence to build a holistic view of the seabed to inform how it can sustain a wide variety of industries and biodiversity for the long term. This includes:

Unlocking value for the nation

The seabed is a valuable national asset and through Round 4, significant value has been secured for the benefit of the nation.

Under the Agreements for Lease, The Crown Estate receives an annual option fee from each project developer, until they are ready to enter into a lease for the seabed site. The option fee sum was determined by the project developers themselves through an open market process to ensure fair value for seabed rights was captured. Option fees will contribute toward The Crown Estate’s net revenue profit, 100% of which is paid to HM Treasury for the benefit of the nation.

The total commitment across all six projects is approximately £1bn per year, reflecting the confidence in the UK’s world leading offshore wind sector and Government’s commitment to grow the low carbon economy.