LR: UK Offshore Wind Leasing Round 4 to Be Highly Competitive

The Crown Estate’s Offshore Wind Leasing Round 4 will be highly competitive, with multiple developers vying to take a slice of a 7GW opportunity, according to Tristan Chapman, Senior Vice President of Renewables and Innovation from Lloyd’s Register.

As previously reported, the Crown Estate opened the leasing Round 4 in October, offering seabed rights for new projects in the waters around England and Wales

According to Chapman, Round 4 and the forthcoming Scottish round are a golden opportunity for the UK to cement its position as the global leader in offshore wind.

The sector has demonstrated its ability to innovate and drive down costs, and with regular Contracts for Difference (CfD) rounds on the horizon, there is a clear route to yet more volume and cost reduction.

However, the Round 4 leasing areas bring new challenges, and the need for developers to consider carefully their site assessment and project design, according to Chapman.

In what is becoming an increasingly congested marine environment, new schemes may need to co-exist with current and future oil and gas infrastructure. The competitive nature of the tendering process means winning bidders will need to provide best-in-class wind resource evaluation, onshore grid connectivity optioneering, ground risk management, constraints evaluation, metocean analysis, and cable route engineering.

Add in the desire from the Crown Estate (and possibly BEIS) to incentivise further innovation – including floating projects – and it is clear a comprehensive approach to developing a commercially competitive bid will be key, Chapman said.

A bidder’s site selection will need to take into account a range of factors including finding the most favourable ground conditions for foundation installation and capacity; considering constraints such as marine protected areas, visual impact, and fishing operations; oil and gas and subsea hazards that can range from unexploded ordinance’s (UXO) to existing infrastructure, such as pipelines and cables.

Whilst much of this information is already in the public domain – it is vital that bidders assemble a team that can bring together experience in the marine environment as well as experience in wind.

Onshore grid connection availability and options will also be key. All entrants in the round will need to think about not only the most economic routes, but also the installation methodologies required, and the cables post-lay longevity – which can have a major impact on project viability and ultimate return.

Given this complexity, LR believes that multi-disciplinary teams are the best way to assess and analyse these multiple and inter-related inputs. Access to data and clear decision making is critical, and the ability to share data between all decision-makers is key, Chapman said.