State energy company ESB faces further delays with a wind-power project that cost it almost €106 million in write-offs last year.
ESB and French state-controlled power company, ÉDF, are jointly building the Neart na Gaoithe wind farm off Scotland’s Firth of Forth on the country’s east coast.
This week it emerged that Italian engineering group Saipem will be late in delivering wind turbine foundations to the offshore project, slowing its development.
ESB wrote €105.6 million off its investment in Neart na Gaoithe last year after it emerged that seabed conditions at the site posed more problems for its construction than anticipated.
The Irish company yesterday acknowledged that technical issues combined with Covid-19’s impact on global supply networks had “inevitably” delayed Neart na Gaoithe.
“The project team is currently assessing the effect of these delays but what is most important is the welfare of those working on the project and that the work itself is carried out safely,” said ESB.
The group’s accounts for the first six months of 2021 show that ESB cut the value of its holding in the Scottish wind project to €137.5 million from €243.1 million as a consequence of the problems it had encountered.
The write-off was “non-cash”, meaning it was an accounting exercise meant to reflect the likely impact of the delays on the value of the ESB’s investment in Neart na Gaoithe.
Separately, it emerged yesterday that hold-ups in delivering steel jackets, used to anchor wind turbines on the seabed, to Neart na Gaoithe, prompted Saipem’s recent warning of a likely deterioration in profits.
News agency Bloomberg quoted unnamed sources as saying that the Italian group's losses could exceed the €550 million value of the Neart na Gaoithe supply contract.
Saipem did not comment. The group last week blamed Covid’s impact on supply chains and technical problems, for its woes. A spokeswoman for ÉDF Renewables said Covid-19 had hit supplies to the project while technical problems had added to delays.
Milan-based Saipem is best known for supplying equipment such as drilling rigs to oil wells, but has been expanding into the offshore wind business.
Mainstream Renewable Power, founded by Irish green energy lobbyist, Eddie O’Connor, began the Neart na Gaoithe project. It sold the site with planning consents to ÉDF in 2018.
The 105 sq km site will cost more than €2 billion to develop. The offshore plant will generate enough electricity to power around 375,000 homes when it is completed, according to some forecasts.
