SSE warns of wind farm delay after £39m Irish Sea deal

SCOTTISH & Southern Energy has warned that construction of many of its Scottish wind farms could be delayed after it bought a stake in a £1 billion project in the Irish Sea.

• Ian Marchant: Deal strengthens offshore construction portfolio

Perth-based SSE has acquired 25.1 per cent of the Walney Wind Farm Project, east of the Isle of Walney near the Isle of Man, paying up to 39 million to Dong of Denmark.

The deal requires SSE to pay about 250m towards the construction costs of the wind farm, which is designed to have a capacity of 367 megawatts when it is completed near the end of 2011.

Yesterday, SSE said that funding for the project would come from its investment budget for the five years to March 2013, which will lead to "some other projects previously in the programme being delayed". A spokeswoman said SSE would give Walney priority over some other wind farms, but did not have details about which projects face delays.

SSE, through its renewable energy business Airtricity, has 30 wind farm projects in the UK which are in the planning process or construction, with 27 of these in Scotland or its surrounding waters.

High-profile projects such as Greater Gabbard in the Thames estuary and Clyde, the world's largest onshore wind farm, are unlikely to be affected by delays because construction is already well advanced.

Chief executive Ian Marchant said the potential for harnessing wind off the coast of the UK was "vast", and that Walney and Greater Gabbard gave it a strong offshore construction portfolio for the coming years. Construction of Walney will be completed in two phases, the first of which is expected to begin early in 2010.

The second phase, which will use new 120 metre turbines designed by Seimens, will begin later in the year.

SSE will pay 22m to Dong, and up to a further 17m depending on Walney's performance.