Fears rise that Liberal peer’s Kincardine offshore floating wind farm has financially sunk

Proposed location of offshore floating wind farm near Stonehaven
Proposed location of offshore floating wind farm near Stonehaven

Fears were growing last night that two of Scotland’s ‘pioneering’ floating offshore wind-farm developments may never get out of the water.

A report from the Carbon Trust has suggested that this may be because of the costs of ‘fixed-bottom’ offshore wind farms has fallen so far that it has left floating wind farms financially marooned high above the CfD rates announced last week.

The Kincardine offshore floater – being developed by Lord Nicol Stephen, a former Liberal MSP – must be commissioned by the end of this month October 2018 to qualify for Scotland’s Renewables Obligation deadline for floating wind.

However, construction work on the subsea ‘floating’ concrete bases for the eight Kincardine wind farm turbines – which was due to start 10 week ago at Kishorn – has been delayed.

The £250 million project was expected to create up to 200 jobs at Kishorn, which has been told that the developer is ‘reconsidering its methodology’.

Simon Russell, a director at Kishorn Port Ltd, said: “We are very disappointed with the delays to this project, as we have invested over £1 million making the site shovel ready for this contract and for other potential contracts that are being actively pursued.”

It is understood that development work on the Dounreay Tri floating wind farm has also halted.

A recent report by the Carbon Trust for multi-national wind-farm developers and the Scot-Govt – crucially conducted prior to last week’s CdD prices – said:

“As such it can be assumed that floating wind will be expected to compete within the offshore wind contract auction for £105/MWh…the expected reduction in revenue as a result of this change is approx. £82/MWh, or 44%.

“Another major project within Scottish waters is the Kincardine Offshore Windfarm, approximately 10 miles from Aberdeen. The project is being progressed by Pilot Offshore and Atkins, while ACS Cobra will provide concrete semi-submersible/spar hybrid platforms, supporting 6-MW turbines.

“The consent application has been submitted, but the project faces a race to secure all the necessary permits and investment to secure commissioning before October 2018.

“Floating wind developments are also being pursued on the far north coast, off Dounreay.

Here, a planned test centre was previously being developed by Highlands & Islands Enterprise but the Dounreay Floating Offshore Wind Development Centre was recently scrapped due to uncertain market conditions beyond 2018.

“This site was considered favourable due to a secured grid access (with a 9.9MW grid connection), low concerns over protected bird species (compared to east coast sites) and favourable environmental considerations (wind/wave/tidal regimes etc.).

“As a result, technology development company Hexicon are now working through a Special Purpose Vehicle (Dounreay Trì Limited, to proceed the site realisation and capitalise upon already defrayed development expense (e.g. prior consent studies). This project, if realised, will consist of two turbines of 5 MW capacity on a multiple turbine semi-submersible structure.”

If the factors highlighted in the Carbon Trust report are realised, it would represent a major setback for the sector, where as recently as March 2017, Andy Thompson, Atkins’ market lead for offshore and onshore assets, commented:

“Floating wind represents an excellent opportunity for the offshore wind sector. Within Atkins we have the capability and opportunities to take the lead in designing and harnessing the potential of this technology ahead of anyone else in the world.

“It is great news that Hexicon’s Dounreay Tri project has received consent approval and we hope it’ll pave the way for more innovative developments of this type in our sector. We have been involved in this unique project from the concept phase and we look forward to continuing to support Hexicon to make their idea a reality.

 “With the recent go ahead announced for the Kincardine offshore wind farm, another project that we’re closely involved with supporting ACS Cobra, Allan MacAskill and Lord Nicol Stephen, it’s never been a better time for floating wind.” 

9 Oct 2017

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