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Belgium

Belgium

Uncertainty persists in year of false starts -- Dutch and Belgians in waiting

For Dutch and Belgian offshore projects, 2002 was a year of false starts. Three separate wind farms, with a combined capacity of 319 MW, were sent on their way by their respective governments, only to be delayed for procedural reasons.

First out of the blocks was the Q7-WP project initiated by Dutch renewables agency E-Connection along with turbine manufacturers Vestas, Smit Maritime Contractors, ABB and financiers Fortis Bank. Their plans for a 120 MW plant some 23 kilometres off the Dutch coast were approved in mid-February last year. Construction, due to begin in March, was postponed when the Dutch ministry of finance was unable to provide a ruling on the project's eligibility for a tax break that is vital to improve early liquidity. Although it is almost certain the project will qualify for the break, Q7-WP investors were unwilling to proceed. Project initiator Mathieu Kortenoever now expects a ruling on eligibility in time for construction to begin in April 2004 for completion in October 2004. With the recent production incentive of EUR 0.064/kWh granted to Dutch offshore wind, financing will not be a problem, he says.

overwhelmed

Next in line was the government's long planned 100 MW near-shore pilot after the contract was awarded last March to NoordZeeWind, comprising Dutch power company NUON and Shell, its collaborator on an the UK Blyth offshore project. ING bank will provide finance and Ballast Nedam is charged with construction. The consortium planned to have the project operating by October 2003, but it postponed work until April 2004 for completion in 2005. The delay is due to the government's insistence that the planning application process begin only after the full completion of the bid solicitation. As a result, NoordZeeWind has now been overwhelmed by paperwork.

Uncertainty also surrounds the construction schedule of Belgium's first offshore project, the 100 MW Seanergy wind farm, which is to be built some 15 kilometres off the coast on the Vlakte van de Raan by Belgian power company Electrabel and construction concern Jan de Nul. According to Electrabel's Thierry Saegeman, unresolved legal action in Belgium's highest administrative court, taken by local councils angered by the lack of consultation, could still delay construction, which is scheduled to begin this summer (Windpower Monthly, December 2002).

"We are getting everything ready to begin work if we get a positive ruling," says Saegeman, adding the group hopes to have completed phase one of the installation -- ten of an eventual 50, 2 MW Vestas turbines -- by the end of the year. Construction should begin in July. Cables for the project will be laid over the summer, connected directly to the existing 36 kV grid by the port of Zeebrugge. Work on the second phase will begin after any start-up problems have been resolved, says Saegeman.

According to Saegeman the real questions surrounding the Seanergy venture are financial rather than technical. Seanergy will be financed entirely from the green certificate system introduced in Belgium this year and the green premium of the power generated will be used to meet Electrabel's renewables obligations under that system. The Belgian green certificate scheme is untested, and some details must still be formulated. As such it involves a considerable political risk, "as we've seen in Denmark and the Netherlands," says Saegeman. "We are also worried that European harmonisation will drive the average certificate price downwards." Consequently, Electrabel has no further plans for offshore development. "We want to see how the Seanergy project goes. That is enough of a challenge for now."

Shell's 300 MW project

Others are less cautious. Two consortia have applied for a domain concession on Thornton Bank -- a sandbank in Belgium's restricted economic interest area outside its North Sea territorial waters, which, lying some 30 kilometres from the coast, represents a far greater technological challenge. Zephyr, a 50/50 consortium consisting of Belgian Shell and electricity producer SPE Power, has announced plans for a 300 MW plant with 110 turbines at a cost of EUR 600 million. Meanwhile C-Power is applying for another 300 MW project on the same sand bank. The group consists of Belgian turbine manufacturer Turbowinds, electricity distributor Interelectra, building company Dredging International, investment company Ecotech Finance and energy holding firm Socofe -- the last of which also holds shares in SPE Power.

For Zephyr, SPE Power's Luc Debusschere says a ruling on their application "could be weeks or months." General elections on May 18 are a further complicating factor. In the most favourable circumstances, construction would begin in 2004, says Debusschere. The costs of laying cabling at such a distance would, however, be prohibitive and require some form of collaboration, suggests Filip Martens of C-Power. Electrabel's Saegeman is sceptical about the economic, administrative and technological feasibility of the project proposals. "Thornton Bank belongs very much to the future," he says.

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