Swedish energy giant Vattenfall halts UK wind farm project due to spiraling costs
Swedish state energy giant Vattenfall has abandoned plans to build a multi-billion pound wind farm on the outskirts of Norfolk due to spiraling costs, dashing hopes that it would power around 1.5 million homes.
It blamed a large rise in costs since winning a contract for the Norfolk Boreas project last year after bidding a record low price of £37.35 per megawatt-hour, based on 2012 prices and linked to inflation.
Chief Executive Anna Borg said: ‘The offshore wind market is challenging.
Rising inflation and capital costs are affecting the entire industry, but the geopolitical situation has made offshore wind and its supply chain especially vulnerable. We see cost increases of up to 40 percent.”
Bad wind: Vattenfall blamed a large increase in costs for abandoning the Norfolk Boreas wind farm project that was expected to power around 1.5 million homes.
The decision has cost him £415 million. Vattenfall has two other projects, Norfolk Vanguard East and West, that are under scrutiny.
RenewableUK’s Dan McGrail said: “Government must step up with a strong response to enable industrial growth.”
A government spokesperson said: “We understand there are supply chain pressures globally, not just in the UK, and we are listening to the concerns of businesses.”
The UK is a world leader in offshore wind farms, home to the four largest in Europe, with the capacity to power at least 10 million homes a year.