Biggest offshore supply deal yet -- Dong secures 1.8 GW from Siemens

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Denmark's Dong Energy, Europe's leading offshore wind developer, has signed an agreement with the wind division of power industry giant Siemens for the supply of 500, 3.6 MW turbines for 1.8 GW of offshore wind projects in Northern Europe. Dong also used Siemens 3.5 MW wind turbines for its existing Burbo Bank wind farm off England's north-west coast and its Gunfleet Sands project in construction off the east of England.


Both Dong and Siemens refuse to specify where the turbines are to be deployed, saying only that the locations will be determined by permitting procedures and country-specific wind regime economics. Neither will Andreas Nauen, head of wind energy at Siemens, be drawn on whether the agreement involves other parties, the names of which would reveal the likely destination of the turbines. "I know where you're going with that," he quips, declining to be specific. "It's a fully firm contract," he adds. "First projects start in 2010." The turbines will all be made in Denmark.

Although specifics on project location are missing, Dong is heavily into offshore development in the UK, with involvement in consented projects with a combined capacity of 2058 MW. They include the 1000 MW London Array project and the 450 MW Walney wind farm in the Irish Sea off north-west England, on which work begins in the spring on the first 151 MW phase. Further to the consented projects, Dong is developing the 234 MW Westernmost Rough project and is part of consortia bidding for thousands of megawatts of potential development licences in the UK's third round of government concessions for offshore wind farm licences.

Siemens and Dong have a history of cooperation on construction and operation of offshore wind projects, points out Dong CEO Anders Eldrup. "With this agreement the parties are jointly taking a quantum leap towards further streamlining the construction of projects of this kind." He adds that Dong has built approximately half of all offshore wind farms in operation in the world today. "Entering into the largest single offshore wind turbine supply agreement ever further strengthens Dong Energy's leading position in this field and provides us with an important tool for implementing our strategy of significantly expanding Dong Energy's position within sustainable energy."

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