Ofgem Reveals OFTO Tender Round 5 Start Date

UK’s energy market regulator Ofgem will start the fifth tender round (TR5) for offshore transmission owners (OFTOs) where companies will bid to become owners of five transmission links to offshore wind farms on 10 October 2016. 

The five links have an estimated value of GBP 2 billion in total and a generation capacity of 2.3 GW – making it the biggest tender round to date.

Ofgem, which runs the tender process, will choose the most competitive bids from companies to own and run links to the offshore sites over a 20-year period.

The launch of the fifth round comes after Ofgem announced a shortlist of five bidders to own and run the GBP 230 million transmission link for the Burbo Bank Extension offshore wind farm in the Bay of Liverpool earlier this month.

The five offshore wind farms for which transmission links are being tendered are the 402MW Dudgeon, the 336MW Galloper, the 580MW Race Bank, the 400MW Rampion, and the 660MW Walney Extension offshore wind farm.

Jonathan Brearley, senior partner, networks, Ofgem, said: “Since the launch of the OFTO regime, the first three tendering rounds have delivered £700 million in savings and have attracted over £3 billion in investment value. By providing the opportunity for investors to now participate in the tendering of over £2 billion of assets in the next round, it should ensure the delivery of further value for consumers and contribute to reducing the overall cost of offshore wind.”

Dudgeon is located 32km off the coast of Cromer in North Norfolk, and is being developed by Statoil ASA, Masdar, and Statkraft AS.

Galloper is a project equally owned by RWE, Siemens Financial Services, UK Green Investment Bank and Macquarie Capital. The wind farm is situated 27km off the east coast of England, adjacent to the Greater Gabbard project.

DONG Energy’s Race Bank is located in the North Sea, 27km north of Blakeney point off the coast of Norfolk, and 28km east of Chapel St. Leonards off the coast of Lincolnshire.

Rampion is jointly owned by EON (50.1%), Enbridge (24.9%) and Green Investment Bank (25%). The wind farm is situated 13km off the south coast of England, near Sussex.

Located approximately 19km from shore in the Irish Sea, DONG Energy’s Walney Extension contains two phases. For the purposes of TR5, both phases will be treated as a single qualifying project and one licence will be awarded to an OFTO to operate the Walney Extension, Ofgem said.

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