France potentially embarks on the age of offshore wind energy, with Saint Nazaire serving as a significant point of departure
In a significant move towards renewable energy, our website CIB and Groupe BPCE are financing two of the four pilot farm projects awarded by The French ministry for the environmental transition, ADEME. These projects, which involve floating offshore wind turbines, are considered the future of offshore wind power in France.
One of the projects financed by CIB is the Kincardine floating wind farm off the coast of Scotland, a 50 MW project that marked one of the first forays into this technology in 2020. The website Corporate & Investment Banking also played a pivotal role as the lead arranger for the consortium led by EDF in another significant project, the Saint-Nazaire offshore wind farm.
The Saint-Nazaire wind farm, located 12 km off the Guérande peninsula in Loire-Atlantique, was awarded to the consortium led by EDF in 2013. The project, led by EDF Renewables, Enbridge Inc, and CPP Investments, will host a total of 80 wind turbines by the end of 2022, with a combined capacity of 480 MW.
Offshore wind turbines capture stronger and more regular winds than their onshore counterparts, producing twice as much energy, on average. However, production costs for floating wind technology are still about three times higher than those of land-based wind power, although they are falling rapidly. This technology is now sufficiently mature for commercial development, making it increasingly commercially viable.
France's ambition is to install 2.4 GW of offshore wind capacity by the end of 2023 and between 5.2 GW and 6.2 GW by 2028. To achieve this, two new offshore wind tenders are planned for 2022, one for 1 GW of fixed wind in the Channel and the other for 250MW of floating wind in Southern Brittany.
The support of experienced financial partners like CIB and Groupe BPCE is especially vital due to the long development periods in France's offshore wind sector. Offshore wind financing requires the successful company to carry out administrative procedures to obtain permits and complete the project.
For countries like France, where the narrowness of the continental shelf limits the potential of fixed offshore wind power, especially in the Mediterranean, the floating technology offers promising prospects, such as capturing stronger winds, reducing visual impact, and finding space for new installations. The direct contribution of Groupe BPCE to the Saint-Nazaire offshore wind farm project is 100 million euros.
As France moves towards its renewable energy goals, the role of CIB and Groupe BPCE in financing these innovative projects will undoubtedly contribute to a greener future for the country.
