German energy company RWE has agreed to acquire the 4.2GW Norfolk Offshore Wind Zone portfolio in the UK from Vattenfall for £963m.
The portfolio has three offshore wind projects to be developed off the east coast of England, namely Norfolk Vanguard West, Norfolk Vanguard East, and Norfolk Boreas. Each of them has a planned capacity of 1.4GW and collectively will meet the power consumption needs of four million British households.
According to RWE, the projects are located 50 to 80km off the coast of Norfolk in East Anglia, within an area recognised as one of the world’s largest and most desirable regions for offshore wind development.
Following 13 years of development, all the three projects have obtained seabed rights, grid connections, development consent orders, and other crucial permits.
The Norfolk Vanguard West and Norfolk Vanguard East projects are currently the most advanced, having secured procurement for the majority of key components.
RWE revealed that the next developmental milestone for the two projects is to secure a contract for difference (CfD) in one of the upcoming bidding rounds.
For the Norfolk Boreas project, the German firm will resume the development, which was previously stopped.
The company expects all the three projects to begin operations within this decade.
RWE Offshore Wind CEO Sven Utermöhlen said: “With the acquisition of the Norfolk Offshore Wind Zone portfolio, we are taking over three well-advanced offshore wind projects from Vattenfall.
“I am very happy that we will work with Vattenfall towards facilitating team continuity to ensure the successful handover and further development of the projects. Equally I am looking forward to continuing the work with the supply chain companies.”
Vattenfall said that the agreement with RWE is the optimal path for both the company and the Norfolk projects. Through the sale, Vattenfall will enhance its capacity to invest in projects aligned with its broader portfolio and risk tolerance, emphasising a focus on fossil-free initiatives.
Simultaneously, the future of the Norfolk Offshore Wind Zone is assured, said the Swedish energy company.
Vattenfall CEO Anna Borg said: “Both the UK and the offshore market remain attractive over the long term, and we will focus our offshore investments in projects which are appropriate to our current risk appetite while continuing to operate and grow our existing fleet of assets.”
Completion of the transaction is contingent on approval from The Crown Estate and regulatory authorities, with an anticipated timeframe in Q1 2024.
Earlier this week, Vattenfall reached an agreement to divest its entire district heating business in Berlin, Germany to the State of Berlin for approximately €1.6bn.
