Covestro, a leading supplier of high-performance polymer materials, has signed a 10-year corporate power purchase agreement with Ørsted to buy green power from the Borkum Riffgrund 3 offshore windfarm
The agreement makes Covestro the first major chemical company in Germany to sign a long-term corporate power purchase agreement (PPA) with a supplier of renewable energy.
Ørsted Offshore executive vice president and chief executive of Ørsted Offshore Martin Neubert said, “Our agreement with Covestro is the first tangible step to secure stable revenues for part of the power generated by Borkum Riffgrund 3 which will be built and operated without subsidies.
“At the same time, this corporate PPA shows that offshore wind can be a reliable source of green power delivering the large volumes required by energy-intensive industrial players.
“With this agreement, Ørsted and Covestro are supporting the energy transition in Germany and the continued build-out of renewable energy, which is urgently needed to reduce carbon emissions in the German industrial sector.”
Covestro chief executive Dr Markus Steilemann said, “By purchasing green electricity, we are underpinning our comprehensive sustainability strategy and preparing ourselves for the expected rise in energy prices and CO2 costs.
“We hope that doing so will motivate our customers and value chains toward sustainable industrial production. At the same time, we also hope that co-operation with Ørsted will stimulate the accelerated expansion of renewable energy in Germany.
“Without green electricity, the chemical industry and industry as a whole cannot make its contribution to ensuring that Germany becomes largely greenhouse gas-neutral by the middle of the century, as specified in the climate protection plan.”
Covestro will offtake 100 MW of the windfarm’s 900 MW total capacity for 10 years, which makes it the world’s largest corporate PPA for offshore wind. The PPA will be effective from 2025 when, subject to Ørsted’s final investment decision, Borkum Riffgrund 3 is expected to be fully commissioned.
Borkum Riffgrund 3 will be built in the German North Sea adjacent to Ørsted’s existing offshore windfarms, Borkum Riffgrund 1 and Borkum Riffgrund 2.
Borkum Riffgrund 3 comprises three offshore wind projects which were originally awarded to Ørsted in auctions in 2017 and 2018 under the names Borkum Riffgrund West 1 (420 MW), Borkum Riffgrund West 2 (240 MW) and OWP West (240 MW).
The three projects were renamed in September 2019 and will be built as one joint project.