Renewable energy project monitor

Mike Major

November/December: Our regular column, written by the Energy Industries Council, reports on project development in the renewable energy marketplace...

There was positive progress in the renewable energy marketplace during November and December, with 94 renewable energy projects added to EIC DataStream, representing a total potential investment value of US$51.4 billion.

EIC DataStream tracks over 9,000 of the most significant projects across the global energy industry. There are currently around 923 active renewables projects, and a further 1,043 projects proposed for future development (of course as ever it should be noted that there will always be a proportion of proposed projects that do not gain planning consent and the requisite finance).

November highlights

In November, 48 renewable energy projects were added to EIC DataStream, representing a total potential investment value of US$20.0 billion. Around 50% of this value came from wind projects - with 29 onshore and offshore wind farms added to the database.

The largest project - which saw major development - was the US$2.9 billion offshore wind farm Nautilus II, an installation comprising of 80, 7MW turbines with a total capacity of up to 560MW. This project will be located in the North Sea, about 180km north-west of Helgoland, Germany. In early November, PNE Wind sold the rights for the project to SSP Technology Holdings, part of Ventizz Capital Funds. The project is currently in the planning and approval phase, and could be ready to enter construction by 2013. PNE Wind will continue to develop the project as a service provider - until approval is received.

A key development in the quest for cleaner energy was the announcement made by the African Development Bank, which offered to invest US$329 million in the groundbreaking Morocco hybrid wind and hydro-electric power plant. The US$2.2 billion project is expected to have a total output of 1,070MW, which will almost double Morocco’s existing hydropower capacity. The project is expected to become operational in 2017, with construction beginning in 2012.

This is the largest hybrid project of this type globally – by comparison it is 10 times the size of a similar project on which construction began in the Canary Islands in 2010. In addition, the African Development Bank will also earmark an additional US$150 million for the Morocco hybrid project from the Clean Technology Fund (CTF), which it helps to finance with other lenders.

In the UK, architects Foster and Partners and the Halcrow Group have unveiled plans for the development of a tidal barrage valued at US$804 million - as part of the US$78 billion Thames Hub scheme. This has the potential to transform London’s Thames Estuary. The project features an industrial scale tidal barrage and in-stream arrays, along with a new flood defence system. The project will be 500 metres in width, will cover a 5km stretch of the River Thames, and will comprise 1,000, 60-90kW run-of-river turbines giving a capacity of up to 90MW - enough to supply the needs of 76,000 homes.

Options are being explored to route energy production from the project into power transmission infrastructure being developed for the project. The Thames Hub vision also comprises an international airport, shipping and rail complex, and a ‘spine’ which combines energy, communications and data running the length of the UK, fed by the Thames Hub.

Meanwhile in Ethiopia, the Ethiopian Electric Power Corporation (EEPCO) has revealed plans to construct 6 new wind farms and a geothermal power plant in the country. The projects will have a total capacity of 1,015MW. This includes the 250MW Galema I, 100MW Debre Birhan and 152MW Adama II wind farms - all located in Addis Ababa - and the 70MW Alutu Langoano geothermal project, which is located in the main Ethiopian rift valley at Lakes District, between Lakes Langano and Ziway. The project is being financed by the Japanese government and the World Bank, as well as the Ethiopian government.

Overall in November, good levels of new projects continued to come through across all the renewable energy sectors. Bold projects such as the Thames Hub offer the potential to create thousands of skilled jobs, as well as generate other economic benefits. It is good to see the renewables sector continuing to show real innovation in tackling the issue of long-term energy security.

December action

There was plenty of activity in December too, with 46 renewable energy projects added to EIC DataStream, with a combined value of US$30.6 billion. Over 40% of the total potential investment value of projects came from solar projects, with 17 solar power plant projects added to the database.

In South Africa a lot of activity surrounded the announcement of preferred bidders to supply the South African energy grid - in respect of the first 1,415MW (out of 3,725MW) under the Renewable Energy IPP Bidding Programme.

Solar Capital has been selected by the Department of Energy (DoE), as the preferred bidder to supply the South African energy grid with electricity generated by its PV solar farms. The US$4.2 billion project will be located at De Aar, and is part of the larger footprint of 25 solar farms that Solar Capital is developing in the Northern Cape. The 75MW installation is the first phase of the project, which is expected to have a total capacity of up to 300MW. Solar Capital plans to bid for additional licences for its 50,000 hectares of land, in the Northern and Western Cape provinces.

The next largest project announcement came out of Northern Ireland. The Crown Estate has launched leasing rounds for the US$3 billion offshore wind farm County Down project. The lease will be for up to 600MW – located off the southeast coast of County Down, and will be leased to a single development company. Tenders will be assessed on the ability of bidders to deliver operational projects by 2020, with development rights to be awarded in the second half of 2012.

Also in Northern Island, The Crown Estate has launched leasing rounds for tidal development projects with a total capacity of up to 200MW - valued at US$1.6 billion. The project will be located in the Rathlin Island and Torr Head Strategic area. The lease will be open to tidal-stream developers, with projects having a capacity of up to 100MW, to be located off the southeast coast of County Antrim. Again, tenders will be assessed on the same deployment schedule as for the County Down wind farm.

Across the other side of the world in Australia, the new US$1.5 billion, 600MW Clean Energy Precinct Project in Moolawatana, South Australia, has been announced. This project will comprise a mix of gas, wind and solar power generation (later geothermal power connection), and will be tailored to meet the needs of mining customers in the north-western region of South Australia.

The Precinct project is expected to be developed in a staged process with the first 300MW of power generation coming from a combination of gas and wind. The second 300MW stage is expected to include the introduction of large scale geothermal and solar. The project is located on Moolawatana Station, just 50km north of the Paralana geothermal project site in South Australia. Petratherm Ltd has commenced the planning of this project.

Another important project is the Scottish Outer Solway Project. DONG Energy has reached an agreement with the Crown Estate to examine the project potential in coastal waters off Dumfries and Galloway, Scotland. DONG will carry out a feasibility study in the Outer Solway over the next four months. The potential site would be at least 8km from the shore in an area south of Luce bay, and to the north of the Isle of Man. DONG is looking at the feasibility of a project - with a capacity of up to 300MW in an area of around 60km2.

As a postscript to 2011, overall in 2011 there were more than 740 renewable energy projects added to the database - with a potential investment value of over US$400 billion, and showing a strong commitment and drive towards green energy sources. As we move into 2012, we expect to see a continued focus on cleaner energy, providing plenty of opportunities for the global energy supply chain.

About the author: Mike Major is chief executive of The EIC (Energy Industries Council)

About EIC DataStream: EIC DataStream tracks over 8,800 of the most significant projects across the global energy industry. 917 are active renewable energy projects, and a further 998 projects are proposed for future development. Of course it is important to note that there will always be a proportion of proposed projects that do not gain planning consent, as well as the requisite finance.


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Energy infrastructure  •  Geothermal  •  Other marine energy and hydropower  •  Policy, investment and markets  •  Solar electricity  •  Wave and tidal energy  •  Wind power