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Tailwind for Large Investors – Analysing Ownership Structures in Offshore Wind Power
sector (on- and offshore) and also affects ownership structures. power and concentrated their investments almost exclusively on fossil
Electricity companies in particular faced regulatory incentives as well as and nuclear power plants. Shell, as another example, withdrew its stake
disincentives in the different countries. In Denmark and Germany, for in the London Array offshore windfarm in order to focus on onshore
example, utilities could not benefit from public incentives in the early wind power investments in the US. This underlines the fact that there is,
years of onshore wind power development. This situation has changed of course, considerable variety in the strategies of large energy suppliers.
in recent years, however. In the UK, electric utilities are obliged to
account for a continuously increasing share of renewables in their Offshore UK – A Look into the Future
supply portfolio through either direct ownership or purchase from Are the organisational particularities of offshore wind power identified
others. This has pushed many UK suppliers to invest in wind energy. above likely to prevail in the future? A look at the latest developments
in the UK provides some first insights into this issue. The UK’s offshore
Second, the innovation characteristics of offshore wind power differ in wind power market is not only the current frontrunner in terms of
many respects from those of onshore wind power. Planning is much installed capacity but also sticks out due to the eager expansion plans
more complex and time-consuming, construction and maintenance of the British government. With the recent announcement of successful
require new solutions and grid connection is demanding. There is still bids for another 32GW of offshore windfarm zones, the UK may see
little experience with the novel application context and uncertainty is 40GW or more installed by 2020. The awarded licences also provide us
high. Moreover, offshore wind parks require a level of financial capital with a perspective on the future in terms of wind power ownership and
that easily exceeds the requirements for onshore projects by an order of prominent players in the field.
magnitude. In other words, offshore investments entail much higher risks
than onshore wind power investments and require large amounts of As of 2009, Dong Energy holds more than 30% of the offshore wind
capital. It seems that many established onshore investors cannot cope power assets in operation, followed by RWE, Centrica, TWC and
with these new requirements, while large electricity suppliers as well as Vattenfall as key players. This situation is likely to change in the years to
gas and oil companies have the financial resources, and to some extent come. Market concentration will decrease and RWE, Centrica, Scottish
also the technological competence, to shoulder offshore wind projects. & Southern, Vattenfall and Scottish Power seem likely to become the
leading companies (see Figure 1). Also, new players that have not been
Third, actual investment decisions also depend on the individual in the energy production business before will enter the market,
strategies of the firms in the field. Some utilities, such as E.ON, RWE and including Siemens, Mainstream Renewable Power and Fluor. It seems
Vattenfall, have committed themselves only very recently to the novel that the latest round of awarded licences (denoted in red in Figure 1) will
technology, while in earlier years they fought fierce battles against wind fundamentally change the ownership structures in the UK’s offshore
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