The proposed 49% share in the East Anglia wind farm is one of the latest in several deals secured between the UAE and Britain. The UK’s offshore wind industry is facing several challenges, predominantly due to rising costs, causing some concern over the viability of selected projects secured at low prices within the government scheme. The UAE, however, is expected to take a stake in a second UK offshore wind site in the space of a week as the region continues to acquire more market share in the UK wind industry.

The planned investment in the East Anglia Three offshore site, which the renewable energy major Masdar hopes to complete this quarter, is one of several deals signed since the COP28 climate summit as it works on strengthening its green credentials. Masdar, chaired by Sultan Al Jaber, the COP28 president, intends to acquire 49% of the 1.4GW wind farm, currently in the development stage off the Norfolk coastline. The project represents one of the UK’s largest, supported by leading Spanish energy business Iberdrola.

The backing of the project, which will start producing power in 2026, indicates the UAE will invest in projects that other developers may consider unfeasible due to the lower prices secured for the electricity produced. The UK wind industry faces financial challenges as rising costs have caused concern over the viability of some projects awarded at low prices within the UK’s contracts for difference scheme. Some developers are requesting further government support to enable continued project development. East Anglia Three has a strike price of £37.35/MWhr, the guaranteed maximum price the government will pay operators for electricity generated. Last month, the government increased the maximum strike price for the next offshore wind auction to £73/MWhr to balance the more challenging conditions in the industry.

Masdar recently stated that while the market is experiencing a challenging period, it also represents an opportunity for their business to invest and support the industry. Masdar highlighted their strong relationship with the UK and commitment to investing in infrastructure and the energy transition. The proposal comes after the UAE launched a $30 billion climate-focused investment fund with BlackRock, TPG and Brookfield. Masdar’s recent investments indicate they are being proactive in developing wind farms. They recently acquired a 49% stake in the UK’s Dogger Bank South project and last year agreed on a similar share in the Iberdrola 476MW offshore wind site in the Baltic Sea. Masdar highlighted that the 49% share represented their intention of becoming a developer, sharing development risk, deploying personnel and co-developing the projects.

The agreements with Iberdrola represent part of the funding plans that Masdar and the Spanish Group confirmed at COP28 to support renewable energy projects. Combining the experience of Iberdrola with the financial strength of Masdar, competitive clean energy can be delivered more securely and efficiently.

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