The Crown Estate boosted by windfall from offshore wind

Announcing net revenue profit for 2020/21 of £269.3M, which represents a decrease of 21.9% compared to the previous financial year in its overall performance, The Crown Estate said this year’s performance was boosted by the impact of recent Offshore Wind Leasing Round 4.

The value of The Crown Estate’s portfolio increased by 7.5% to £14.4Bn, driven in part by an increase in its marine portfolio of £2.1Bn, primarily as a result of valuing Offshore Wind Leasing Round 4 for the first time.

In the competitive tender process of Offshore Wind Leasing Round 4, The Crown Estate identified six potential new offshore wind projects in England and Wales. These projects, which are now progressing to an environmental assessment known as Plan-Level HRA, could deliver a further 8 GW of offshore wind power. Round 4 projects, together with planned leasing from Crown Estate Scotland, build on the UK’s existing pipeline of 41.4GW, and could help take the total to nearly 60GW.

Round 4 projects achieved record investment from developers and a major vote of confidence in the UK’s green economy, with successful bidders committing an initial investment of £879M in option fee deposits.

Income from Round 4 option fees will not be realised The Crown Estate’s balance sheet until after the conclusion of the environmental assessment stage, with rights expected to be awarded in 2022.

Describing The Crown Estate’s results as a whole, chief executive Dan Labbad said, “Whilst the challenges posed by the pandemic and associated economic impacts are clear to see in our results, drawing on a diverse portfolio we have continued to demonstrate both our strength and resilience, contributing £3 billion to the public purse over the last ten years and building a portfolio valued at over £14 billion.

“What the pandemic has thrown into sharp relief is that challenge and uncertainty are the new normal and there is no doubt we will face another difficult year ahead, but with the progress of the vaccination programme and our collective resilience as a society, there is reason to be cautiously optimistic.”