The Crown Estate signs leasing agreements for six offshore wind farms

The Crown Estate has signed agreements for lease for the six offshore wind projects that were awarded seabed rights in its fourth offshore wind leasing round in February last year.

Three of the projects are located in the North Sea off the coasts of Yorkshire and Lincolnshire, whilst the other three are located off the coasts of North Wales, Cumbria and Lancashire. They have a proposed generation capacity of almost 8GW.

Under the agreements, the project developers will pay The Crown Estate option fees until they are ready enter into leases for the sites.

In the fourth offshore wind leasing round, the option fees were for the first time determined through a competitive bidding process and amount to around £1 billion per year across the six projects.

The agreements for lease have a maximum term of ten years. By entering the agreements, developers have committed to paying at least three years of option fees. The option fees reduce as projects move into leases and cease when leases for the maximum capacity or whole site are granted, at which point developers will move to paying rent.

These fees will contribute to The Crown Estate’s net revenue profit which is paid to the Treasury.

“The UK’s offshore wind achievements to date are nothing short of remarkable, and this next generation of projects point to an even more exciting and dynamic future,” said The Crown Estate’s chief executive Dan Labbad.

“They demonstrate the far-reaching value that our world-class offshore wind sector can deliver for the nation: home grown energy for all, jobs and investment for communities, revenue for the taxpayer, clean energy for the benefit of the environment and a considerate, sustainable approach which respects our rich biodiversity.

“Moving forward, working with our stakeholders to continue unlocking this value is what drives us, and we are more committed than ever to lead the way in ensuring this important benefit is realised for our environment and for the nation.”

Energy and climate minister Graham Stuart said: “Britain’s position as the European leader in offshore wind shows no signs of letting up. These six projects demonstrate how areas across the UK can contribute to ensuring Britain meets its world-leading ambition of deploying up to 50GW of offshore wind by 2030.

“Offshore wind is at the heart of our goal to secure clean, affordable and resilient energy supply for all in the UK, while bringing major business, investment and job opportunities along with it.”

Following a Habitats Regulations Assessment, The Crown Estate will oversee the development of a strategic environmental compensation plans to offset the impacts of the projects on two protected sites – the Dogger Bank Special Area of Conservation and the Flamborough and Filey Coast Special Protection Area.

It will now establish steering groups for each of the sites, comprising government and statutory conservation bodies and the relevant project developers, to develop detailed plans for delivering the commitments made by The Crown Estate as part of the assessment.

The Crown Estate has awarded seabed rights to around 41GW of generation across its four offshore wind leasing rounds so far, of which almost 12GW is already operational.

The body has additionally identified potential sites for the deployment of 4GW of floating offshore wind generation in Celtic Sea by 2035.

In January last year, Crown Estate Scotland awarded seabed leasing rights to 24.8GW of offshore wind projects as part of its ScotWind leasing round, including ten floating wind projects with a combined capacity of 14.6GW.