SSE Renewables, the project development arm of the British utility SSE, has selected turbine supplier MHI Vestas for its 1.1-gigawatt Seagreen project off the east coast of Scotland.
Seagreen was one of the winning projects in the U.K.’s most recent contracts for difference (CFD) auction. The project secured a 15-year contract with a guaranteed price of £41.61/megawatt hour ($53.41) covering 484 megawatts of its total capacity of 1,075 megawatts. SSE plans to build out the remainder of the capacity as well.
MHI Vestas will provide up to 114 turbines to Seagreen to cover the development area, the two companies said Thursday. The project is scheduled for completion during the 2024/25 delivery year, which runs April to April.
Shashi Barla, Wood Mackenzie’s principal analyst for global wind supply chain and technology, said the order with MHI Vestas demonstrates SSE’s desire to diversify its supplier base.
The win for MHI Vestas follows two huge recent orders for GE Renewable Energy’s 12-megawatt Haliade-X turbines, including 3.6 gigawatts from SSE Renewables and Equinor for their Dogger Bank collaboration in the U.K.
“In addition to SSE's turbine sourcing strategy, GE may not be in a position to supply any potential volumes by the 2024 time frame, as they have secured 4.8 gigawatts of contracts [recently], translating to roughly 400 turbines,” said Barla.
“The current GE nacelle and generator facility in France is engaged in manufacturing Haliade 150 turbines for the 480-megawatt project for the EMF consortium," Barla added. "After this order GE will retool the manufacturing facilities to accommodate Haliade-X turbines and components."
"Unless significantly expanded, the current capacity will not be able to provide additional volumes for delivery before 2024."
As the Seagreen project moves toward its final investment decision, SSE Renewables and MHI Vestas will work to "maximize Scottish and U.K. content," John Hill, Seagreen project director, said in a statement.
In June the U.K. government agreed with the offshore wind industry that the goal of installing 30 gigawatts by 2030 would go hand in hand with an increase in local content from 48 to 60 percent.
EDF came under criticism after reports that it would source the majority of the jackets in Asia for its Neart na Gaoithe project, also off the east coast of Scotland. Trade unions characterized the portion of the contract awarded in the U.K. as "paltry."
The Scottish government has been forced to bail out BiFab, the firm that was awarded eight of the 53 jacket foundations for Neart na Gaoithe, adding a political dynamic to future procurement.
The Seagreen project has already selected Scottish port Montrose as its base for operations and maintenance. It has also announced three roadshows next month in Inverness, Aberdeen and Dundee as it looks to add more Scottish suppliers.
A year ago, SSE bought out engineering firm Fluor's half-stake in the project for £118 million. With its CFD contract in place, SSE is now looking for further financing and has said it plans to sell off some of the project equity.
Separately on Thursday, GE revealed the completion of the first Haliade-X field test turbine at the Port of Rotterdam. A second test turbine will be installed offshore at the ORE Catapult facility in the U.K.
