Essen,
20
September
2019
|
09:03
Europe/Amsterdam

innogy successful in UK auction with Sofia Offshore Wind Farm

  • Planned installed capacity of 1.4 gigawatts

  • Final investment decision planned for 2020

  • Capital expenditure expected to total approx. £3 billion

  • Full commissioning scheduled for 2026

 

Today, innogy SE moved a step closer to the realisation of what is currently its largest development project: Sofia, an offshore wind project with a consented installed capacity of up to 1.4 gigawatts (GW), won a contract from the UK Department for Business, Energy & Industrial Strategy (BEIS) in the latest auction round to support renewable energy projects (Contract for Difference).

This means that the project can now progress towards the final investment decision and into construction. With a price of £39.65 per megawatt hour (MWh), this third allocation round has seen the lowest ever price for offshore wind in the UK.

Hans Bünting, COO Renewables of innogy SE, explains: “I am very pleased that Sofia, the largest project in our offshore wind portfolio, has been successful in the latest UK auction. We have passed an important milestone on the way to realising Sofia wind farm and also proved that we can continue to be successful in a very competitive market environment. Sofia’s auction success confirms the excellent work the team has done in recent years. Thanks to our extensive know-how in the development as well as the construction and operation of complex offshore projects and our varied research and development activities we have succeeded in developing a valuable project and in further reducing the costs for offshore wind energy in the UK.”

The consented wind farm, located 195 km off the UK coast on Dogger Bank in the North Sea, has proven wind conditions and relatively shallow water depths of 21 to 36 metres. The final investment decision for Sofia is expected to be made during 2020 when the contracting agreements with prospective supply chain partners will be completed. The external financing process will then be finalised.

Onshore works are scheduled to begin in 2021 with offshore construction getting underway from 2022. First power is due to be generated in 2024/25 and on the current schedule, the wind farm would be fully operational by the end of 2026.

Once in operation, the total amount of power Sofia could generate would be enough to provide almost 1.2 million average UK homes with their annual electricity needs. The planned investment volume is in the region of £3 billion.

Sofia Offshore Wind Farm is 100% owned by innogy SE. innogy will review all options regarding the ownership and financing structure of the project in order to maximise value for the company and shareholders.

Please find our video statements here.

Note to editors:

Support of new renewable energy projects in the UK based on the Contracts for Difference scheme

New renewable energy projects in the UK are supported on the basis of a mechanism known as “Contracts for Difference” (CfD). The CfD mechanism provides green electricity projects with essentially a fixed ‘strike’ price (which is adjusted annually for inflation) for electricity over the project’s initial 15 years of operation. The strike price includes for costs of transmission to the onshore substation which is a different approach to that in the German market. In the UK’s third CfD Allocation Round (2019) qualified bidders competed in an auction with an overall budget of £65m and a capacity cap of 6 GW.

 

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This document contains forward-looking statements. These statements are based on the current views, expectations, assumptions and information of the management, and are based on information currently available to the management. Forward-looking statements shall not be construed as a promise for the materialisation of future results and developments and involve known and unknown risks and uncertainties. Actual results, performance or events may differ materially from those described in such statements due to, among other things, changes in the general economic and competitive environment, risks associated with capital markets, currency exchange rate fluctuations, changes in international and national laws and regulations, in particular with respect to tax laws and regulations, affecting the Company, and other factors. Neither the Company nor any of its affiliates assumes any obligations to update any forward-looking statements.