Profitability of new projects in spotlight

摘要

SHRINKING rates of return and long payoff times are eating away at the profitability of some Euro-pean offshore wind projects, according to new research. A Norwegian research group has found that the UK's 3.6-giga-watt Dogger Bank - owned by Equinor, SSE Renewables and Eni - has a nominal internal rate of return (IRR) of 5.6% and a pay-back time of 17 years. The findings, by Petter Osmundsen and Sindre Lorentzen - professor and associate profes-sor at the University of Stavan-ger's industrial economics section - and Magne Emhjellen, senior economist at Norwegian oil and gas player Petoro, suggest that potential profits from offshore wind in Europe are falling fast. The research was published by the International Association for Energy Economics. The research group, which has received funding from the Norwe-gian Ministry of Petroleum, has made transparent project calcula-tions for selected bottom-fixed UK offshore wind farms.