Power Purchase Agreement signed for Triton Knoll Offshore Wind Farm project
- Ørsted to offtake power production by Triton Knoll for 15 years
- Power Purchase Agreement helps secure entire income stream forfirst 15 years of generation
- Commissioning of offshore wind farm expected in 2021
innogy SE announced today that a Power Purchase Agreement (PPA) was signed with Ørsted under which the company will offtake 100 per cent of the power produced by the Triton Knoll Offshore Wind Farm for the first 15 years of generation. Triton Knoll has a planned installed capacity of 860 megawatts (MW), and expects to begin commissioning in 2021. Both sides have agreed to maintain confidentiality regarding the conditions of the PPA.
The PPA compliments Triton Knoll’s Contracts for Difference (CfD)1, mitigating any market price uncertainty for the first 15 years of the wind farm’s operation.
"With the signing of this PPA with Ørsted and the Financial Closure, which we have reached today, we are confident that our flagship Triton Knoll Offshore Wind Farm has robust, financial security at its heart. The successful delivery of this arrangement with Ørsted also demonstrates the continued success of innogy’s ability to forge valued, strategic partnerships as we continue to grow our offshore portfolio across the globe. While we may compete in some areas of renewables, I’m delighted that we have secured this cooperation with Ørsted and look forward to working closely with them in the future."
Morten Buchgreitz, Executive Vice President, Ørsted Customer Solutions: “Ørsted acknowledges innogy as one of the most successful European energy companies. As we do ourselves, innogy relies on the expansion of renewable energies to grow their business activities and fight climate changes. Therefore, I’m proud that innogy and its partner companies have entrusted us to handle a 15-year power purchase agreement. I’m very much looking forward to our cooperation.”
Once fully operational, Triton Knoll Offshore Wind Farm will be capable of supplying the equivalent of an expected minimum of 800,000 UK households p.a. with renewable electricity. The planned investment amounts to approximately £2 billion. The project is located 32kilometres off the coast of Lincolnshire in the east of England, and has already been fully consented. At the heart of the project, Triton Knoll will install 90 of MHI Vestas’ v164-9.5 MW turbines, currently considered to be amongst the most powerful and efficient in the world.
Initial works are now underway at the site of the project’s onshore electrical system, which includes a 57km underground cable route, landfall infrastructure and construction of a new onshore substation at Bicker Fen, in Lincolnshire. Full construction of the onshore electrical system is on schedule to begin in September. Offshore construction is then expected to start in late 2019 / early 2020 and, according to current planning, commissioning of Triton Knoll is expected to start in 2021.
In mid-August, innogy confirmed two new partners with whom it will take the Triton Knoll project forward, in line with the company’s strategy of growing its renewables portfolio through partnerships.J-Power will take a 25% share, and Kansai Electric Power a 16% share, while innogy retains the majority equity stake of 59% and will manage the construction, operation and maintenance works on behalf of the project partners.
Further details about project development including selection of suppliers can be found on the project web page: http://www.tritonknoll.co.uk/
1) The CfD mechanism envisages green electricity projects receiving support over 15 years, during which time they receive a guaranteed remuneration for the electricity they generate. The electricity is sold on the wholesale market or via Power Purchase Agreements. Furthermore, if a daily calculated reference price, average wholesale price, is below the strike price awarded in the CfD auction, the difference is reimbursed to the company. If the strike price is higher, the company has to make a corresponding payment. The PPA with Ørsted is based on the same reference price as the CfD.
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.