Historical development and outlook of offshore wind. Dudgeon Offshore Wind Farm case study.

The Dudgeon Offshore Wind farm is located off the coast of the seaside town of Cromer in North Norfolk in the UK. After the final financial investment decision was made in mid-2014, the wind farm started construction in early 2015 and was completed in late 2017. The wind farm consists of 67 turbines with a total installed capacity of 402MW. In recent years, an increasing number of companies have started investing in offshore wind projects. Increased interest makes for more competitive bidding on Contracts for Differences (CfD), resulting in lower strike prices. The Dudgeon Offshore Wind farm was one of the first UK offshore wind projects to be awarded a CfD and as a result received a strike price of £150/MWh compared to the anticipated £46/MWh in allocation round 4. In the thesis, the profitability of Dudgeon Offshore Wind is analyzed at different stages. Firstly, the profitability at the investment decision in 2014 is evaluated, before it is compared with an updated analysis of the project outcome as of 2022. After, a third analysis is performed to assess the economics of constructing a similar wind farm today with larger more modern wind turbines, but with a lower CfD strike price. The results show that the Dudgeon Offshore Wind project so far has been more profitable than what was expected at the investment decision, mainly due to a reduction in capital expenditure and increased future electricity price estimates. The analysis covering the construction of a similar wind farm today shows that the farm is unlikely to turn out profitable due to the lower CfD strike prices awarded in 2022