Scottish energy lawyers warn Crown Estate plans for Scots offshore wind ‘could diverge’ from UK approach

By DAVID FOXWELL

The way Scotland goes about developing offshore wind energy will have significant implications for developers and could diverge from the approach used to date in the UK, legal experts suggest.

Last month Crown Estate Scotland unveiled plans to lease new areas of seabed for offshore windfarms.

But how it goes about doing so could differ from the approach used by the Crown Estate in waters off the UK until now, and developers need to keep abreast of the development of work at Crown Estate Scotland, said Brodies LLP partner Kirsty Macpherson, who is co-head of its renewables team.

Crown Estate Scotland has published its discussion paper on new offshore wind leasing. Until recently, Crown Estate Scotland has been operating under interim management, since powers formerly held by the Crown Estate in England were transferred to it.

More recently, The Scottish Crown Estate Bill, introduced on 24 January 2018, has set out the reforms intended for the Crown Estate Scotland.

Under its interim management, Crown Estate Scotland published a discussion paper on leasing for offshore wind projects, with responses due by 31 August. The findings due to be published by the end of 2018.

“The Crown Estate Scotland is keen to have their first round of offshore wind in process by the end of 2018 with Marine Scotland already working on their Sectoral Marine plan for Offshore Wind,” Macpherson explained.

“This could see the divergence of approach to offshore wind between Scotland and the rest of the UK. Scotland has a real opportunity to chart new waters and are already demonstrating this with the world’s first floating offshore windfarm, Hywind Scotland.

“It will be key that potential developers keep abreast of the findings of this discussion paper and await the publishing of the Sectoral Marine Plan.

“Important to note for UK developers is that the regime in Scotland is likely to differ from the rest of the UK.

“The consenting process already differs but in addition we may well see a different bidding and leasing mechanism develop from previous rounds. Now is the time for all potential developers to engage in the process.”

Pinsent Masons partner Alan Cook noted that work needs to start now on a new leasing model for Scottish waters to ensure that projects are ready to deploy from the late 2020s onwards as it can take years to develop and construct a new offshore wind project.

There are currently two operational offshore wind projects in Scottish waters, with two under construction and others currently under development.

“This consultation marks a step towards the next generation of offshore windfarms in Scottish waters,” he said. “Developers and stakeholders will be keen to engage with Crown Estate Scotland to apply the lessons learnt from past leasing rounds, under which a number of offshore windfarms are now in the operational, construction or pre-construction phases.

“This will also be an important project for Crown Estate Scotland following the recent transfer of the Crown Estate’s Scottish functions to the control of the Scottish parliament.”

A paper setting out a provisional design for a leasing package has been developed by Crown Estate Scotland following early consultation with developers and other stakeholders, but Cook is keen to stress that the model put forward in the paper should be used as “a starting point for discussion rather than a description of our intended final position.”

The paper identifies the seabed being offered for lease as areas identified in the Sectoral Plan for Offshore Wind, which will be published shortly by Marine Scotland.

Crown Estate Scotland does not intend to carry out any preconsenting or other preliminary work in order to identify potential sites for development within these areas before offering them for leasing, in contrast to the approach taken by some other European countries.

It goes on to set out provisional contract terms which would govern successful applicants’ use of the seabed. It also includes details of how it proposes to select successful applicants and of the ‘clearing’ process it will use where there are competing applications for an interest in the same location.

The paper confirms Crown Estate Scotland’s intention to run more than one leasing cycle, and to allow for projects in both conventional water depths and deeper offshore waters. It does not intend to stipulate any particular technology solution or configuration at the application stage, or in the final option agreement.

Crown Estate Scotland is planning a number of events around Scotland for developers and other stakeholders before the consultation period ends on 31 August 2018. It is anticipating that it will launch its final leasing process later this summer or early 2019.

8 June 2018

David Foxwell is Editor of Offshore Wind Journal

http://www.owjonline.com/index.htm 

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