Following market feedback from developers, The Crown Estate has adapted their spatial design and capacity arrangements in the Celtic Sea. While the overall seabed area and outer boundary remain the same, the division and maximum power have been revised to address concerns over lack of space. Rather than four project sites, there will now be three, with an increase in capacity from 4GW to 4.5GW. 

In this Q&A, RenewableUK Cymru’s Director, Jess Hooper, gives her analysis of the situation: 


What is the floating offshore wind industry likely to make of this change? 


The Crown Estate did indicate in their initial July announcement that there were a number of configurations they were considering, and the market feedback they received led them to this. I think industry will understand some of the rationale behind the decision to roll back from four to three sites, because developers expressed concerns around space constraints in terms of the impact this would have on buffer zones and the challenges that poses from a consenting point of view. In pursuing a smaller number of projects there will be fewer buffers and greater flexibility on spacing, which will help get them through planning. Undoubtedly though, it will cause some frustration amongst developers that were anticipating they could bid and win two sites because they will have attributed certain economies of scale, increased opportunities for supply chain engagement and negotiations with the ports. That is no longer possible as The Crown Estate is committed to maintaining a minimum of three winners. The reasoning behind this is to avoid an unfair monopoly and stimulate more competition that will benefit our supply chain companies and ports. 


What do you make of the decision to the increase capacity from 4 to 4.5GW? 


In my mind this is a prudent move. I don’t think that it’s necessarily a target of 4.5GW, more of a ceiling that allows developers to be more ambitious within that area. Whether or not the extra capacity is achievable remains to be seen. It will be subject to assessment of factors, including the spatial scenarios and wake effects, as these will impact on yield. By the sounds of it the developers indicated they wanted that extra ceiling capacity. We welcome the move to inform the grid now of that extra capacity as it allows the scenarios the National Grid are running to progress. We know in terms of infrastructure upgrades, the grid tends to have one of the longest lead times, so this is a positive step forward. 


What will developers be wanting to see next?  

The July update indicated The Crown Estate has a potential appetite for risk sharing, and I think more clarity on that will be sought by developers. They will need to understand how The Crown Estate is intending to support development, be that through engagement with infrastructure or through direct risk sharing mechanisms. What is clear is that The Crown Estate is seeking solutions to the constraints posed by the fact that these developments are with a new technology deploying in a new geographical area, and they are working to understand what tools they have at their disposal to support developers given those increased constraints. 


While the UK’s government constraints on space in this area have now been fully resolved, clarity on that future pipeline beyond 4.5GW and understanding that longer term opportunity is key. Ports and supply chain companies need as much lead time as possible to secure investment. The current delays are eroding our chances of achieving any UK or Welsh content from this leasing round in the Celtic Sea.  

The continued commitment from the Celtic Sea Developer Alliance demonstrates the ambition for the region is still there, and we anticipate a high level of engagement in the opportunity at our upcoming conference, Future Energy Wales. It remains a prominent subject area in our programme, and a number of our side events are focused on the opportunity for skills and supply chain represented by the Celtic Sea.  

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Future Energy Wales takes place on 6-7 Nov at the ICC in Newport