EDF, Iberdrola Beat GDF Suez in French Offshore Wind Tender
Electricite de France SA and partners including turbine maker Alstom SA (ALO) won a French government tender to build three offshore wind farms, and Iberdrola SA (IBE) got one, while GDF Suez SA (GSZ) was left empty-handed.
EDF, Danish utility Dong Energy A/S, and Alstom were picked to build 1,428 megawatts of wind power at three sites off the coasts of Brittany and Normandy, the government said today. Spanish power company Iberdrola and U.K. group RES will erect a 500-megawatt farm with Areva SA (AREVA)’s turbines off the Saint-Brieuc shore in Brittany, though its offer was higher than Paris-based EDF’s on that site, France said.
“We want an industry walking on two legs, which is why we picked the second-best” bidder in Saint-Brieuc, French Industry Minister Eric Besson said at a press conference in Paris today. “It was in Saint-Brieuc that the gap” between the best two bids “was the smallest.”
Today’s win represents an order of about 240 turbines worth more than 2 billion euros ($2.6 billion), which will be booked over a several years, Alstom said in a statement. The company based near Paris will invest about 100 million euros and create 5,000 direct and indirect jobs in French factories that will make towers, blades, generators and nacelles for its 6-megawatt turbines currently under development.
Areva, which manufactures 5-megawatt wind turbines in Germany, has said it will build plants in the French harbor of Le Havre which would also be used if the company were to win orders for U.K. offshore farms. Eiffage SA (FGR), STX and Technip SA (TEC) will help install the foundations of the turbines, Iberdrola and RES said in a joint statement today.
France, which doesn’t yet have any offshore wind power, plans to install 6,000 megawatts of offshore wind, tidal and wave power by 2020 to boost clean energy, Besson said. The four zones awarded today with a combined capacity of 1,920 megawatts will require about 7 billion euros of investment and allow the creation of 10,000 direct jobs, the minister said.
Companies are due to proceed to further studies on the seabed, continue discussions with local stakeholders such as fishermen and confirm funding of the projects by the end of 2013.
Power prices offered by today’s winners all exceeded indicative tariffs suggested by the government in the tender, and will add 1.1 billion euros to the annual electricity bill of French households when these farms are due to be completed by the end of the decade, the minister said.
GDF Suez Empty-Handed
GDF Suez, which was bidding in four of the five offshore areas being tendered today, got none. The Paris-based company didn’t get a site near Le Treport in the Channel where it was sole bidder because its offer was “extremely” costly, Besson said. Awarding the Treport area to GDF would have added an annual 500 million euros to French consumers’ bills, he said.
The government will start another round of tenders for offshore wind farms in the second half, which will again include the Treport area and a site near the Noirmoutier island off the Atlantic coast, among other sites, he said.
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