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High stakes as big oil piles into wind power

04/07/2021 | 06:11am EDT

There is a new energy rush going on offshore.

But it's for wind power, not oil or gas.

Governments are expected to offer a record number of sites for development this year.

More than 30 gigawatts of capacity is set to go on the block.

That is almost as much as total existing offshore global wind capacity of about 35 gigawatts.

And experts say it's shaping up to be the most competitive round of bidding ever.

In part, that's as new players pile in.

European oil majors including Total, BP and Shell all want to rapidly increase their renewable power portfolios.

In one recent UK rights auction BP paid a record price.

Established wind power firms like Spain's Iberdrola were outbid.

Experts wonder what the frenzy means for profits and prices.

BP says its low cost base means it can still make a profit even if it has to bid high.

But some think consumers will eventually end up paying higher prices.

The UK is the world's biggest market for offshore wind power.

But other countries are following its lead.

Denmark, Poland and France are all expected to hold auctions this year.

In the U.S., President Joe Biden wants to see 30 gigawatts of offshore wind power by 2030.

BP is active there too, last year buying big stakes in two developments.

In Asia, Japan wants up to 45 gigawatts by 2040.

Analysts say most countries have a long way to go to catch up to Europe on offshore power.

But a global wind rush is gathering force.

© Reuters 2021
Stocks mentioned in the article
ChangeLast1st jan.
IBERDROLA, S.A. 0.35% 11.375 Delayed Quote.-3.08%
LONDON BRENT OIL -0.04% 68.22 Delayed Quote.34.33%
WTI -0.09% 64.79 Delayed Quote.37.41%
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