In the wake of the British government's recent decision to elevate support prices in the upcoming Contracts for Difference (CfD) auction, Vestas Wind Systems A/S (CPH:VWS) is actively considering the establishment of a wind turbine factory in the UK, according to reports from Bloomberg.
This strategic move reflects the Danish manufacturer's renewed commitment to expanding its footprint in the UK, where it currently operates a production facility for wind turbine blades on the Isle of Wight.
Henrik Andersen, CEO of Vestas, confirmed ongoing discussions regarding a potential site, emphasizing proximity to a large harbor with direct access to the sea. Andersen suggested that the chosen location “could very well be in Scotland,” underscoring the importance of accessibility to facilitate efficient logistics.
The recent decision by the British government to boost the maximum price for offshore wind projects in the sixth CfD allocation round by 66% has catalyzed Vestas' considerations. The maximum strike price for offshore wind in the upcoming round, scheduled for March 2024, is set at GBP 73 (USD 91/EUR 84) per MWh, reflecting a substantial increase from the previous tender.
Vestas acknowledges the need for a UK production facility strategically positioned near a larger harbor, aligning with the company's growth strategy. However, the potential expansion plan remains contingent on factors such as market demand and the volume of orders anticipated. Vestas Wind Systems A/S seeks to capitalize on the evolving dynamics of the UK's renewable energy landscape, emphasizing adaptability and responsiveness to market conditions.