Published on May 4th, 2018 | by Joshua S Hill0
EDF Group Acquires Troubled 450 Megawatt Neart na Gaoithe Offshore Wind Farm
May 4th, 2018 by Joshua S Hill
Leading independent renewable energy developer Mainstream Renewable Power has this week sold the 450 megawatt (MW) Neart na Gaoithe offshore wind farm, located off the east coast of Scotland, to French electric utility EDF Group.
The EDF Group, via EDF Renewables in the United Kingdom, a joint subsidiary of EDF Energy and EDF Energies Nouvelles, and Mainstream Renewable Power announced the transaction this week following a competitive bidding process in a deal that is worth around £1.8 billion ($2.44 billion). The Neart na Gaoithe has an expected capacity of 450 MW and will generate enough clean electricity to support around 375,000 homes. The project — named ‘Strength of the Wind’ in Gaelic — has an existing 15-year Contract for Difference with the UK Government set at €140 and has grid connection agreements already in place.
“This large-scale new offshore project demonstrates our strong ambition in being a leading global player in the offshore wind industry,” Bruno Bensasson, EDF Group Senior Executive President responsible for Renewable Energies and Chief Executive Officer of EDF Energies Nouvelles’ Group said. “It confirms EDF Group’s wider commitment to renewables in countries where EDF already has a strong footprint such as the United Kingdom. The project is consistent with the CAP 2030 strategy that aims at doubling EDF’s renewable energy generation by 2030”.
“We are very pleased to be bringing in such an established partner and supporter of the Scottish energy industry in EDF Renewables to this vital infrastructure project for Scotland,” added Mainstream Renewable Power’s Chief Executive Officer, Andy Kinsella. “The completion of this sale adds to Mainstream’s global track record as the leading independent developer of some of the most significant and complex wind and solar projects across Europe, South America, Africa and Asia. The Neart na Gaoithe offshore wind farm has been fully developed by Mainstream and we are delighted to be handing over this world-class project.”
EDF Group’s desire to demonstrate its “strong ambition,” however, comes in a unique package, considering the troubled history the Neart na Gaoithe brings with it. Specifically, the 450 MW offshore wind farm was nearly brought to its knees by, believe it or not, a group called The Royal Society for the Protection of Birds (RSPB) Scotland.
Over more than two years, the Neart na Gaoithe offshore wind farm battled to retain its planning permission and even its government subsidy contract. The project was awarded a Contract for Difference, defined by the UK Government as “a private law contract between a low carbon electricity generator and the Low Carbon Contracts Company (LCCC)” designed to support the development of renewable energy projects. The €140 CfD price, awarded in March of 2015, corresponded to the indexation of the tariff of £114.39 that was set in 2012 prices. However, a year later the contract was severed by the LCCC due to a judicial review requested by RSPB Scotland.
What followed was a legal tussle that ended up making its way to the highest court in the land, the Supreme Court. One of the more interesting issues that arose during proceedings was the overturning of a legal decision by the Inner House at the Court of Session in Edinburgh, Scotland. The reason? Lord Carloway, the Lord President of the Court of Session, penned an Opinion of the Court which dispatched the original judge’s findings, saying that the judge “strayed well beyond the limits of testing the legality of the process and has turned himself into the decision-maker following what appears to have been treated as an appeal against the respondents’ decisions on the facts.” Further, the judge appears to have acted “almost as if he were the reporter at such an inquiry… For this reason alone, his decision on this ground cannot be sustained.”
This wasn’t even the end of it, however, considering that RSPB Scotland continued to fight, and it wasn’t until November of 2017 that Scotland’s Supreme Court rejected RSPB’s application to appeal a previous go-ahead decision — a decision RSPB did not take with the equanimity one might have hoped: RSPB Scotland’s Director, Anne McCall, said “RSPB Scotland is extremely disappointed by the Supreme Court’s decision to refuse permission to appeal the recent Inner House, Court of Session Opinion.”
Unsurprisingly, Mainstream Renewable Power was more pleased with the verdict: “After more than two and a half years, two court hearings and two rejected applications for leave to appeal by RSPB Scotland, we can finally focus on delivering the very significant benefits this project brings to the Scottish economy and its environment,” said a relieved Andy Kinsella, Chief Executive Officer, Mainstream Renewable Power.
The 450 MW project is expected to be commissioned in 2023 — after being delayed by at least two and half years, according to Mainstream — and expected to displace 400,000 tonnes of CO2 each year.