Offshore wind can be an expensive undertaking, so the more partners a development can have, the better. Norway’s StatoilHydro (s STO) said yesterday that it’s decided to share the burden of its Sheringham Shoal offshore wind farm project in the UK with another Norwegian firm, energy utility Statkraft, marking Statkraft’s first move into offshore wind.
StatoilHydro didn’t say how much Statkraft is paying for the 50-percent stake, but total investments in the 315-megawatt project are expected to be about 10 billion krone ($1.5 billion). And Statkraft is coming on board after all of the paperwork has already been sorted out — StatoilHydro said the wind farm has already received all of the approvals needed for construction and operation, and that onshore work will kick off this summer, offshore construction will start up next year. Wind power generation is expected to start up gradually in 2011.
The Sheringham Shoal project is set to be built between 10 and 15 miles off the coast of Norfolk, in the northeast of England, with 88 turbines to go up in the North Sea. Those turbines are coming from Siemens (s SI), which is supplying 3.6 MW turbines for the wind farm. StatoilHydro said the project is expected to produce 1.1 terawatt hours of electricity per year, which the company said is enough energy to power 220,000 UK homes.
Statkraft is moving in on the UK wind market as companies such as Royal Dutch Shell (s RDS.A) and BP (s BP) are moving out. The project is much smaller than the 1,000-MW London Array, but offshore wind can cost twice as much as onshore projects, and the viability of offshore wind in the UK has been questioned in the past. The country has a goal of supplying a third of its electricity from wind power by 2020.
Statkraft, therefore, is betting on long-term growth in the market. In a statement yesterday, Statkraft CEO Bard Mikkelsen said, “Europe is facing massive growth in renewable capacity by 2020, and 50 percent of the growth is expected to come in wind power.”
Photo of 3.6 MW turbines courtesy of Siemens.