RWE closes deal for Vattenfall’s 4.2GW UK offshore wind pipeline
RWE closes deal for Vattenfall’s 4.2GW UK offshore wind pipeline | Windpower Monthly
German utility RWE has closed the deal to acquire a 4.2GW North Sea offshore wind pipeline from Swedish counterpart Vattenfall and set its sights on upcoming UK renewable energy tenders.
It has bought the Norfolk Vanguard West, Norfolk Vanguard East and Norfolk Boreas projects – all of which have a capacity of 1.4GW – in a £963 million (€1.1 billion) deal announced late last year.
All three projects are fully permitted – though do not have offtake agreements in place – and are due to be commissioned off the coast of Norfolk in eastern England this decade.
The majority of Vattenfall’s Norfolk team will now join RWE to continue project development.
RWE aims to secure contracts for difference for the Norfolk Vanguard East and Norfolk Vanguard West projects in the UK’s next renewable energy tender, which opens this week. It plans to secure preferred supplier agreements for the Norfolk Boreas project and then enter it at a later auction.
Related Knowledge Center: Offshore wind energy
Over the next decade, U.S. offshore wind power is expected to grow from a single 30-megawatt wind farm off Rhode Island to more than 2,000 MW of capacity along the Atlantic Seaboard. There are contracts for wind power off the coasts of Massachusetts, Connecticut, New York, Maryland, New Jersey, Rhode Island, and Virginia.
The National Renewable Energy Laboratory has estimated the United States has over 4,000 gigawatts (GW) of offshore wind potential, enough to power the country four times over.
The growth in part being spurred by state solicitations, including in New York, where then-Gov. Andrew Cuomo (D) set a commitment of 9,000 MW of offshore wind by 2035, and in Connecticut, where in June 2021, Gov. Ned Lamont (D) signed legislation authorizing the construction of 2,000 MW of offshore wind by 2030.
The offshore development is also being driven by an investment tax credit set to end in December 2019 and is equal to 12 percent of expenditures. U.S. Sens. Susan Collins (R-Maine) and Tom Carper (D-Del.) have introduced a bill to extend the tax credit for up to eight years.
The Interior Department has held eight competitive lease sales that resulted in 15 offshore wind leases over 1.7 million acres that has the potential for 21 GW of capacity. In February 2022, the Bureau of Ocean Energy Management completed a bidding process that realized $4.37 billion for 488,000 acres across six lease areas in federal waters off New York and New Jersey.
Projects have also been proposed off the Southeast coast, off California and Hawaii, and for the Great Lakes.