It will pay UK utiity SSE an initial £70 million (€78.5 million) for a majority stake in its 1075MW Seagreen 1 Seagreen 1 (1075MW) OffshoreFirth of Forth, UK, Europe Click to see full detailsproject, with a further £60 million to be paid from earnings.
The deal marks Total's largest foray into UK offshore wind to date. Its only other UK offshore wind holding is an 80% stake in a 96MW floating project under development off the coast of Wales.
Total and SSE have also confirmed the turbine supply deal for MHI Vestas to provide V164-10.0MW machines for Seagreen.
SSE last year secured a £41.61/MWh support deal for the first 454MW of the 1,075MW project in the Firth of Forth, off Scotland's east coast, through the UK’s contract for difference (CfD) tender scheme. Having secured a CfD support deal, SSE signalled its intention to reduce its equity stake in the project.
The 15-year CfD contract represents 42% of the total project capacity, while an additional 30% is contracted under a private offtake agreement with the SSE Group. The remaining 28% could be supported by a private offtake agreement such as a corporate power purchase agreement (PPA), or this portion of the project could be supported by merchant wholesale revenues.
SSE is due to commission the first 454MW phase of Seagreen in 2022 or 2023.
Having made a final investment decision on the project, SSE also confirmed the signed contract with MHI Vestas to provide Seagreen’s 10MW turbines. The blades will be manufactured on the Isle of Wight, with service operations based in Scotland. Aberdeen-based Seaway 7 secured the contract to install the turbine foundations and inter-array cables for Seagreen.
"Seagreen will make a significant contribution to the UK’s green recovery from coronavirus by unlocking £3bn of low carbon investment and generating the low carbon power we need to reach net zero,” SSE chief executive Alistair Phillip-Davies said.
According to Total, both companies are waiting for public authorities’ approval but hope the deal will be finalised by July.
Last month, Total pledged to achieve net-zero emissions in Europe by 2050 while SSE Renewables’ strategic objective is to treble its renewable output by 2030.