BP Goes Big on UK Offshore Wind Farm Lease
Posted on 02/09/2021
RWE, BP plc (formerly known as British Petroleum) and Total SA were some winners in the U.K.’s first major auction of offshore wind farm leases in more than a decade. The U.K. dreams to have a third of its electricity from offshore wind by 2030. According to the Crown Estate, a total of six projects, representing just under 8 gigawatts (GW) of capacity, were successful in the auction.
In a hotly contested bidding war, BP made its first move into the U.K. offshore wind market, winning two sites representing a total of 3 GW jointly with German regional utility EnBW, paying more than bidders for other areas. Royal Dutch Shell’s offer was nowhere near BP’s bid. BP and EnBW will each pay around £1 billion in fees for the project before the FID, in four annual payments of £231 million for each of the two leases.
The projects and bidders that will progress to the next stage of Offshore Wind Leasing Round 4 are:
| Project identifier | Bidding Area | Region/ location | Successful bidder | Proposed project capacity (MW) | Number of homes proposed size could power (approx.) | CO2 emissions reduction potential p.a. (tonnes) | Option fee deposit paid (exc. VAT) |
|---|---|---|---|---|---|---|---|
| 1 | Bidding Area 1 – (Dogger Bank) | Off the Yorkshire Coast, North East of Scarborough | RWE Renewables | 1500 | 1394000 | 2344176 | £114,304,500 |
| 2 | Bidding Area 1 – (Dogger Bank) | Off the Yorkshire Coast, North East of Scarborough | RWE Renewables | 1500 | 1394000 | 2344176 | £133,350,000 |
| 3 | Bidding Area 2 – (Southern North Sea region, the eastern parts of the Wash and the East Anglia region) | Off the Lincolnshire Coast, East of the Humber Estuary | Green Investment Group – Total | 1500 | 1394000 | 2344176 | £124,573,500 |
| 4 | Bidding Area 4 – (North Wales region, the Irish Sea region, and the northern part of the Anglesey region) | Off the Northern Welsh Coast, North East of Anglesey | Consortium of EnBW and BP | 1500 | 1394000 | 2344176 | £231,000,000 |
| 5 | Bidding Area 4 – (North Wales region, the Irish Sea region, and the northern part of the Anglesey region) | Off the Lancashire Coast, West of Blackpool and South West of Morecambe Bay | Offshore Wind Limited, a Joint Venture between Cobra Instalaciones y Servicios, S.A. and Flotation Energy plc | 480 | 446000 | 750136 | £44,751,840 |
| 6 | Bidding Area 4 – (North Wales region, the Irish Sea region, and the northern part of the Anglesey region) | Off the coast of Barrow-In-Furness, West of Morecambe Bay | Consortium of EnBW and BP | 1500 | 1394000 | 2344176 | £231,000,000 |
Source: Crown Estate
Green Dreams
BP seeks to increase its renewable power generation to 50 GW by 2030 from 3.3 GW now at returns of 8% to 10%, while gutting oil output.