Approval of three offshore windfarms could bring £14m a year to Shetland in community benefit 

The NE1 site. Image: Crown Estate Scotland.

Three offshore windfarms have been approved for development – representing around £3.3 billion of investment.

Crown Estate Scotland today (Wednesday) confirmed the three applicants for the NE1 site – 12 miles east of Bressay – had seabed option agreements in place. 

The three projects – led by Ocean Winds, Mainstream Renewable Power and ESB Asset Development – would provide an estimated 2.8GW of energy – six times more than Viking Energy.

Shetland Islands Council is currently working on its “Energy Development Principles” which would require the three developers to pay a total of £14m a year in community benefit. The benefit could take the form of cheaper energy provision, sometimes referred to as a “Shetland tariff”.

Infrastructure director John Smith said the council and other interested bodies would be seeking “close engagement with the developers”.

As well as the community benefit, Mr Smith said the emphasis would be on: minimising environmental impacts; co-existing with other sectors or the economy, particularly fishing; and making use of the local supply chain.

“The NE1 development process must recognise and be guided by these principles,” he said. 

Shetland Fishermen’s Association, while supportive of renewables, has previously expressed concern that offshore windfarms could harm important spawning grounds for key species, while leaving huge swathes of ocean out of bounds for vessels.

The applicants will have to pay £56m in option fees plus multimillion pound annual payments, once the windfarms are operating, to support public spending. 

Crown Estate Scotland has also mandated the applicants to outline supply chain commitments, which it said was a world first. 

Head of offshore wind development Colin Maciver said: “Today’s confirmation of three more ScotWind agreements is extremely positive news.

“These projects will further boost delivery of clean offshore energy that is central to Scotland’s efforts to tackle the climate emergency, secure the UK’s energy supply, and generate billions of pounds of investment in Scotland.

“We look forward to working with all applicants in the years to come.”