Vattenfall leaves door ajar on Norfolk Boreas as it announces 4GW Vestas deals for UK offshore wind projects
Vattenfall leaves door ajar on Norfolk Boreas as it announces 4GW Vestas deals for UK offshore wind projects | Windpower Monthly
The Danish wind manufacturer and Vattenfall signed a preferred supplier deal for the 1380MW Norfolk Vanguard West project, with intention to supply 92 of Vestas’ V236-15MW turbines — the largest model in its fleet. Vattenfall said the agreement takes the form of a capacity reservation agreement for the project.
Vestas was also named in exclusivity agreements for Vattenfall’s 1.36GW Norfolk Vanguard East project, plus the 1396MW Norfolk Boreas (Phase 1) project, which Vattenfall officially suspended earlier this year.
Vestas said Norfolk Vanguard East and Norfolk Boreas could feature up to 184 V236-15 MW turbines between them. If and when the turbines are installed, the initial agreements could also see the company service the projects under long-term operations and maintenance (O&M) service contracts.
Siemens Gamesa was previously lined up by Vattenfall as the preferred turbine supplier for the entire Norfolk offshore wind zone, as the projects are collectively known, in 2021.
The news prompted speculation that Norfolk Boreas could now move forward despite Vattenfall throwing its future into doubt earlier this year when it suspended the project due to unfavourable economic conditions.
Vattenfall cited soaring costs, inflation and geopolitical instability as reasons why it shelved Norfolk Boreas. Since then, Bloomberg reported in September that the company was in the early stages of talks with potential buyers to sell the project, and Vattenfall confirmed it was assessing its options as to the project’s future.
Door ajar on Boreas project
A spokesperson for Vattenfall told Windpower Monthly a decision on the future of Norfolk Boreas had not yet been taken, leaving the door open on the project's continuation.
They added that the decision to push forward with supplier deals for the Norfolk offshore wind zone projects was made in the context of the UK government raising its prices for future offshore wind tenders including the upcoming AR6 round — with an exclusive funding pot set aside for that tender — but stopped short of saying this was the reason supplier agreements had been made.
“The UK government’s announcement on parameters for AR6 sent a very positive signal for the sector, but direct parallels should not be drawn between the government announcement and individual commercial agreements,” the spokesperson said.
Vestas’ CEO Henrik Andersen pointed directly to the influence of the UK government’s improved offering for upcoming offshore wind tenders as helping facilitate the deals.
“The agreements are the result of close and positive negotiations between two partners as well as the positive changes the UK government has announced for next year’s auction,” he said.
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.