Danske Commodities inks power purchase deal with Dogger Bank offshore wind farm
Danish firm to trade and balance 480MW of electricity generation capacity each year from world's largest offshore wind farm
Danske Commodities has inked a 15-year deal to trade and balance 480MW of electricity generation capacity each year from the world's largest offshore wind farm Dogger Bank, which is currently being developed around 130 miles off the coast of Yorkshire.
The Danish energy trading firm today announced it has signed a power purchase agreement (PPA) with the 3.6GW Dogger Bank project, which is jointly owned by Norwegian oil and gas firm Equinor and Scottish energy company SSE Renewables.
Scheduled to enter full operations in 2023, Dogger Bank is set to be the largest offshore wind farm in the world, providing enough renewable electricity to meet the needs of an estimated 4.5 million average British homes.
The renewable power offtake deal adds to Danske Commodities' growing presence in the UK's PPA market, having inked a 20-year deal with Hywind Scotland - the world's first floating wind farm - as well as a 15-year PPA with Sheringham Shoal offshore wind farm and another 15-year deal to take power from the Dudgeon wind farm.
"The Dogger Bank PPA is a great addition to our long-term portfolio and it shows our commitment to British renewables," said Tor Mosegaard, vice president and head of European power trading at Danske Commodities. "Danske Commodities has traded power in the UK for more than ten years and we see PPAs as a crucial part of ensuring the continued development of renewables."
He added: "As Equinor's power trading arm and route-to-market for renewable power production, we help turn green ambitions into an economically viable business - one wind farm at a time."
In related news, meanwhile, energy services firm ENGIE on Friday announced it is to introduce fixed-price options for long term PPA contracts in a bid to help developers overcome obstacles to common obstacles to investing in renewable energy projects and help accelerate UK's shift to net zero.
Building large scale renewable power generation assets requires significant investment over a relatively long period of time, which has to date largely been facilitated by government subsidies, but this in turn can make it more difficult to raise capital from investors, ENGIE explained.
As such, it said its new offering of "bankable PPAs" would provide more assurance and certainty for investors that the output from a new renewables project will earn a guaranteed income for the duration of the loan repayment period.
The new long-term PPAs offer developers the option of choosing a 100 per cent fixed wholesale price arrangement for the entire contract for agreements of up to 10 years, according to ENGIE, which explained that such an arrangement was previously only available to short-term agreements.
"Developers can also choose competitively priced index-linked price agreements, based on trusted indices, including seasonal fixing and Contract for Difference (CfD) compatibility," ENGIE said.
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