BP Goes Big on UK Offshore Wind Farm Lease

Posted on 02/09/2021


RWE, BP plc (formerly known as British Petroleum) and Total SA were some winners in the U.K.’s first major auction of offshore wind farm leases in more than a decade. The U.K. dreams to have a third of its electricity from offshore wind by 2030. According to the Crown Estate, a total of six projects, representing just under 8 gigawatts (GW) of capacity, were successful in the auction.

In a hotly contested bidding war, BP made its first move into the U.K. offshore wind market, winning two sites representing a total of 3 GW jointly with German regional utility EnBW, paying more than bidders for other areas. Royal Dutch Shell’s offer was nowhere near BP’s bid. BP and EnBW will each pay around £1 billion in fees for the project before the FID, in four annual payments of £231 million for each of the two leases.

The projects and bidders that will progress to the next stage of Offshore Wind Leasing Round 4 are:

Project identifier Bidding Area Region/ location Successful bidder Proposed project capacity (MW) Number of homes proposed size could power (approx.) CO2 emissions reduction potential p.a. (tonnes) Option fee deposit paid (exc. VAT)
1 Bidding Area 1 – (Dogger Bank) Off the Yorkshire Coast, North East of Scarborough RWE Renewables 1500 1394000 2344176 £114,304,500
2 Bidding Area 1 – (Dogger Bank) Off the Yorkshire Coast, North East of Scarborough RWE Renewables 1500 1394000 2344176 £133,350,000
3 Bidding Area 2 – (Southern North Sea region, the eastern parts of the Wash and the East Anglia region) Off the Lincolnshire Coast, East of the Humber Estuary Green Investment Group – Total 1500 1394000 2344176 £124,573,500
4 Bidding Area 4 – (North Wales region, the Irish Sea region, and the northern part of the Anglesey region) Off the Northern Welsh Coast, North East of Anglesey Consortium of EnBW and BP 1500 1394000 2344176 £231,000,000
5 Bidding Area 4 – (North Wales region, the Irish Sea region, and the northern part of the Anglesey region) Off the Lancashire Coast, West of Blackpool and South West of Morecambe Bay Offshore Wind Limited, a Joint Venture between Cobra Instalaciones y Servicios, S.A. and Flotation Energy plc 480 446000 750136 £44,751,840
6 Bidding Area 4 – (North Wales region, the Irish Sea region, and the northern part of the Anglesey region) Off the coast of Barrow-In-Furness, West of Morecambe Bay Consortium of EnBW and BP 1500 1394000 2344176 £231,000,000

Source: Crown Estate

Green Dreams

BP seeks to increase its renewable power generation to 50 GW by 2030 from 3.3 GW now at returns of 8% to 10%, while gutting oil output.

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