U.K.’s Biggest Onshore Wind Farm Gets Green Light From SSE
SSE Plc’s shares jumped after the utility committed to building a giant onshore wind park that’ll be key to the U.K.’s fight to slash its carbon emissions.
The 443-megawatt Shetland Island wind farm is part of a 7.5 billion-pound ($9.4 billion) spending spree announced by the Scottish utility Wednesday that’ll go toward decarbonization projects in the next five years.
Shares rose as much as 10% to their highest since March 11, the biggest gain on the Stoxx 600 Index.
SSE Plans to Invest Billions in Decarbonization in Next 5 Years
“The world is facing twin crises with the economic impact of coronavirus and the climate emergency and the only route forward is to unlock investment,” said Chief Executive Officer Alistair Phillips-Davies.
SSE’s big spending on the energy transition still pales in comparison to some of its bigger, more global rivals.
Spanish utility Iberdrola SA, which operates as Scottish Power in the U.K., said it’ll invest 10 billion euros ($11 billion) this year alone. While Orsted A/S, the world’s biggest developer of offshore wind, said at the end of 2018 that it plans to spend $30 billion by 2030.
Those companies are in an increasingly competitive race to capture market share for offshore wind around the world. SSE is so far focused on its home market where the government has pledged to reach net-zero emissions by 2050.
The 580 million-pound Viking project will be built in the Shetland islands north of Scotland, and will send electricity to the mainland. SSE expects a decision from regulator Ofgem on the power link next month, it said in the statement.
With island wind farms, SSE will be able to capture many of the benefits of building offshore, but without some of the extra costs and complications.
SSE sold a stake in the 3-billion-pound Seagreen Offshore Wind Farm to Total SA earlier this month. That project is also included in the spending plan. SSE also said it’s “continuing to move ahead” with plans to build the world’s largest offshore wind farm off the coast of Yorkshire in England. The Dogger Bank wind farm will create more than 1,000 construction jobs.
The U.K. is the world’s biggest market for offshore wind, having used government support to help launch the sector from the pilot phase to one of the fastest growing sources of renewable power. The high wind speeds and relatively shallow waters of the North Sea make it a perfect location for the technology.
SSE confirmed the final 2020 dividend payment to investors saying that it would stick to its target of increasing payments in line with inflation to year ending March 2023. The company is planning 2 billion pounds of disposals of “non-core” assets like gas production fields.
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