A chunk of the potential offshore wind projects around the world taking key FIDs this year are looking at risk, an analyst has said.
Some 30-32 gigawatts of development remain in the potential pipeline for final investment decisions this year, said Westwood Global.
However, at a webinar last week, head of Energy Transition at Westwood, David Linden, said “a chunk of that is starting to look more at risk”.
There’s already been strong FIDs through the first half of 2023 – some 9.4GW – across China, Taiwan and Europe.
But there have been a series of recent cancellations and pushbacks, including in the UK.
The Danish developer cited the recent Electricity Generators Levy imposed by the UK Government, which means construction and financing are no longer viable on previously-agreed terms.
“That’s a significant one,” said Linden.
“Floating took a gigawatt blow when Trollvind was put on hold.
“And North America was expected to make a significant contribution globally this year, but now several projects are looking to be amended or renegotiate their routes to market.”
Westwood highlighted several examples in North America, including Shell and Ocean Winds’ JV terminating PPAs for the SouthCoast development.
In June, Equinor and BP also sought revised financial arrangements for their New York projects Empire Wind and Beacon Wind.
Elsewhere, Shell is considering the sale of its Eolfi French floating wind unit.
“There are some cracks beginning to show. Projects are being reassessed, portfolios being reshuffled and re-focused,” said Linden.
A “glimmer of hope” came in recent days when Orsted’s Ocean Wind One project in New Jersey received federal approval.
Key offshore wind FIDs to look out for
Westwood set out a series of key FIDs to look out for this year – Hornsea Three in Q4 is among them.
In the UK, that includes the 72-turbine Inch Cape wind farm planned for 10 miles off the coast of Angus in Scotland.
The 1GW project, expected for FID is Q3, is owned by an equal joint venture between Ireland’s ESB and Edinburgh-based Red Rock Power – the latter firm being owned by China’s SDIC.
ScottishPower Renewables’ East Anglia Three, a 1.4GW development 42 miles east of the Suffolk coast is another FID to watch, also expected in Q3.
Once operational, expected in 2026, the 95-turbine development will generate enough green power for more than 1.3m homes.