Vattenfall, the Swedish state-owned multinational power company, is halting its development of the 1.4 GW Norfolk Boreas Offshore Wind Farm, located off the east of England.
Factoring into the comany’s decision is the current climate negatively affecting the energy sector, such as rising inflation and capital costs, higher interest rates and the shaky geopolitical situation, which has put strain on the supply chain and made offshore wind projects especially risky.
The company notes its overall costs on Norfolk Boreas have increased by 40%, adding that this decision will have a $532 million impact on its earnings.
The company will also be examining the future of the entire Norfolk Offshore Wind Zone, which also includes the Vanguard East and West projects. Combined, the trio of projects was expected to produce approximately 4.2 GW of power.
Vattenfall nonethelesss remains convinced that offshore wind power is crucial for energy security and meeting climate goals in Europe. Although substantial, the loss incurred by halting development of the Norfolk Boreas project is partly offset by a positive financial net due to higher returns from the company’s nuclear waste fund.
