DONG Energy today welcomed the
news that three of the company's offshore wind farm development projects will be
supported by Government-awarded financial investment decision (FID) enabling
"We are delighted that we have been successful with all three
of our FID contract applications we submitted to the UK Government," said Henrik
Poulsen, Chief Executive Officer of DONG Energy. "These awards represent the
successful conclusion of the Electricity Market Reform (EMR) process that has
been ongoing over the last few years. It shows that the UK is an attractive
place to invest in offshore wind; not only for its great natural resources, but
also because of the stable investment environment created by EMR."
Cheshire, DONG Energy's UK Country Chairman, said: "These contracts will allow
us to deliver over £5 billion of investment in the pipeline of projects we have
in the UK. They will enable continued growth and investment in the UK supply
chain as well as making an important contribution to reducing the cost of
offshore wind for the benefit of all consumers."
Subject to European
Commission State Aid approval, the contracts will support the development of
DONG Energy’s Burbo and Walney offshore wind farm project extensions, as well as
the first GW of the Hornsea project.
When operational, the three new
projects will together be capable of supplying the electricity needs of almost
two million UK homes.
FID enabling contracts were introduced by the
Department of Energy and Climate Change to bridge the gap between Renewable
Obligation mechanism, which has operated since 2002, and the new Contracts for
Differences arrangements which will shortly come into effect under the
provisions of the Energy Act 2013.
The contracts are designed to avoid a
hiatus in the phased introduction of electricity market reforms designed to
attract the investment needed to replace the UK's energy infrastructure. They
provide companies like DONG Energy with enough certainty to make final
investment decisions on its projects.
Final implementation of the FID
contracts will be subject to State Aid approval from the European Commission.