Pentland Firth and Orkney waters

Following a competitive leasing round, we have entered into agreements for lease for projects with a potential capacity of up to 1,600 MW in the Pentland Firth and Orkney waters.

Overview

Overview

We have entered into agreements for lease for projects with a potential capacity of up to 1,600 MW in the Pentland Firth and Orkney waters. This followed a competitive leasing round for demonstration and commercial scale project sites, and re-tendering of a particular site, which received considerable interest from industry.

The Pentland Firth and Orkney waters is the first area in the UK to be made available for commercial scale development of wave and tidal energy. The projects are believed to represent the largest such developments worldwide. The leasing round was awarded Landmark Renewable Deal of the Year at the Ernst & Young Global Renewable Energy Awards in September 2010.

Leasing round and projects

Leasing round and projects

In September 2008, we announced plans to hold a leasing competition in the Pentland Firth strategic area. Initial proposals for projects were invited from developers in November of the same year, under the first round of a leasing competition with a nominal target capacity of 700 MW. Responses to this invitation were very positive and 38 pre-qualified companies and consortia were subsequently invited to apply for leases.

In May 2009, we announced that 42 applications had been received from 20 bidders, which ranged from small development companies to multi-national energy firms. The associated projects ranged in size from 10 MW demonstration schemes to projects of up to several hundred megawatts.

Negotiations with preferred bidders concluded in March 2010, and agreements for lease were entered into for six wave project development sites and four tidal stream ones. The total potential capacity of these sites is 1,200 MW.

In March 2010 we announced that, following withdrawal from the leasing round of the preferred bidder for a site known as the Inner Sound, we would re-tender this particular site. Between April and September 2010, companies had the opportunity to compete for the Inner Sound and in October 2010 we awarded an agreement for lease to MeyGen Ltd for a project of up to 400 MW. Added to the existing 1,200 MW, the total potential capacity of the Pentland Firth and Orkney waters projects is 1,600 MW.

Support for project development

Support for project development

Since completing the leasing round, we have been working closely with those developers who have been awarded agreements for lease in order to facilitate the development of the projects.

We have decided to invest £5.7m in an enabling actions fund, to accelerate and de-risk project development.

For details, please visit Enabling actions.

We have also set up a developers forum, as a platform for us to engage with the developers and facilitate co-operation between them. Meetings are being held regularly to help define and steer the enabling actions work.

On top of this, we are working closely with the Scottish Government, Highlands and Islands Enterprise, the Highland Council, Orkney Island Council and other stakeholders to help tackle strategic issues facing development and co-ordinate our activities with other public bodies.

These activities underline our commitment to working alongside others as well as independently in order to help make sure that these projects are delivered.