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Offshore wind developers need to standardise contracts

The offshore wind industry is urged to move towards standardised contracts to reduce risk and save project time, say energy consultancy Xodus Group and legal advisors Shepherd and Wedderburn.

Richard Cockburn, Partner in the Energy Group at Shepherd and Wedderburn says: “Developing a new standardised form of contracts for the offshore wind industry would slash time on negotiations between developers and the supply chain and save money.

“The industry should develop a bespoke contracts system for offshore wind that allocates technical and commercial risks in a fair and appropriate manner and is project finance friendly.”

Eric Doyle, Alternative Energy Manager at the Aberdeen-headquartered Xodus Group is also warning offshore wind developers to take a ‘long sighted’ approach or risk losing some of their supply chain to oil and gas projects as the industry picks up over the coming two years.

Doyle says: “Both industries share many of the same suppliers such as manufacturing, engineering consultancy and suppliers of cabling, so there is a real risk of creating a bottle neck, which could impact on project time.

“There has been a lot of consolidation recently of small and medium sizes oil and gas operators, which is giving a renewed boost to offshore orders, which could mean that the wind industry risks losing out if it does not plan for the longer term.”

Doyle adds: “The offshore wind industry should not underestimate the cost of risks and planning ahead with standard contracts can help to minimise some of those liability issues from the start of a project.”

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