RWE shelves massive UK offshore wind farm project
26 November 2013
On November 26, German utility RWE said it had shelved plans to build a 240-turbine wind power project in the seas off the southwest of the UK. The proposed 1.2 gigawatt (GW) Atlantic Array, in the Bristol Channel off the north Devon coast, would have been one of the world's largest offshore wind farms.
"This is not a decision we have taken lightly, however given the technological challenges and market conditions, now is not the right time for RWE to continue to progress with this project," Paul Cowling, director of offshore at RWE's UK renewable energy subsidiary Innogy, said in a statement.
In Britain, soaring gas and electricity prices have fuelled uncertainty over the UK government's commitment to renewable energy subsidies. The scheme had also attracted criticism from environmentalists worried about its potential impact on marine wildlife in the Bristol Channel.
Offshore wind farms have a relatively high risk profile compared with onshore sites, as turbines are installed in open water and need to withstand more challenging weather conditions such as higher wind speeds.
"We will continue to focus on the other less technically challenging offshore projects within our extensive offshore pipeline of up to 5.2 GW," RWE's Cowling said.
RWE, under pressure from plunging wholesale power prices, a boom in renewable energy capacity in its home market as well as Germany's decision to abandon nuclear power by 2022, is in the process of a major restructuring that has led it to slash about 13,000 jobs, or about 18% of its workforce since 2011 and to halve its dividend for this year.
The group is also burdened by 30.8 billion euros ($41.6 billion) of debt and has embarked on a "capital light" strategy, aiming to partly outsource funding for expensive renewable energy projects, including offshore.
Following the announcement, the UK Department of Energy (DECC) told the BBC: "The UK still expects to deploy significant amounts of offshore wind by 2020 and we remain well placed to meet our 2020 renewable energy target."
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