Centrica acquires additional offshore windfarm sites

Centrica plc today announced that it has acquired two adjacent offshore windfarm sites from AMEC Investment Ltd and Offshore Wind Power, a joint venture between Renewable Energy Systems (RES) and British Energy Renewables, for an initial cash consideration of £7 million, plus an additional £2m, which is conditional on the placing of construction contracts.

Both sites, lying about 5km off the south Lincolnshire coast, have planning consent to develop 90MW windfarms, comprising 30 turbines each. Under separate Development Services Agreements, Centrica will retain the services of AMEC and RES to develop a total of 180MW, with the entire output taken by Centrica’s subsidiary, British Gas.

The capital investment cost, assuming the project progresses to completion, together with the acquisition consideration, is currently estimated at approximately £190m, of which £20m will be funded by government capital grants.

Jake Ulrich, Managing Director of Centrica's Energy Management Group, said: "This demonstrates our commitment to meeting our renewable obligation and the progress we are making towards reaching that goal. British Gas has over six million domestic electricity customers and we are determined to play a leading role in ensuring that increasing the level of UK renewable generation becomes a reality.

"We are also pleased to be working with experienced players, AMEC and Renewable Energy Systems, who have a proven track record in windfarm developments."

Following the allocation of a second round development licence on 18 December, 2003, there is a further opportunity to develop an additional 250MW of capacity at this site.

As previously stated, Centrica expects to commit up to £500m over the next five years to participate in building renewable capacity. Its approach will be to work in strategic partnerships to de-risk its investment, maximise the capacity and minimise the capital employed.