Offshore wind developer pulls out of New Zealand amid seabed mining concerns

Spanish offshore wind developer BlueFloat Energy is canceling plans for wind farms off the coast of Taranaki and Waikato, citing “major uncertainties” over the route to market and competition for seabed allocation.

The move comes after a controversial seabed mining plan was revealed to be among 149 projects listed in the government’s fast-track bill.

Developers, including BlueFloat, have previously said the seabed mining project could reduce or completely eliminate the area available for offshore wind power in South Taranaki, which is considered to have the best wind resource in the country.

“Following a global strategic review, BlueFloat Energy has made the decision to cease development of offshore wind projects in New Zealand. In the future, BlueFloat Energy will focus its attention on the most advanced projects in its portfolio,” country manager Nathan Turner told the newsroom.

“BlueFloat Energy continues to believe that offshore wind offers a strategic opportunity for New Zealand, both in terms of decarbonization and economic development. However, our decision to cease developments here reflects a number of important uncertainties about how the offshore wind energy market will develop in the country – including both the route to market and seabed allocation.

“We encourage the New Zealand government to continue its efforts to establish a favorable regulatory regime for offshore wind and to support the industry in overcoming these uncertainties.”

Labor Party energy spokeswoman Megan Woods said BlueFloat’s withdrawal was “a huge loss for New Zealand”.

“Unfortunately, it is not a surprise to me that they are making this decision. We have a government that has dragged its heels and put any work on what is needed to stimulate offshore wind in New Zealand on the slow track.

“More than that, your decision to include the Trans-Tasman resource (seabed mining) license in your fast-track bill is a clear message to the offshore wind investment community that they are not seen as a priority in this country.”

BlueFloat was involved in a joint venture with Kiwi company Elemental Group to investigate the construction of a one-gigawatt offshore wind farm in South Taranaki Bight and another farm off the Waikato coast.

Earlier this year, the joint venture’s director of partnerships, Justine Gilliland, said seabed mining directly threatened the viability of offshore wind.

“If (the seabed mining license) is in the same space, they are not compatible; if it is in adjacent areas, there will still be some problems that we will need to resolve,” she said.

BlueFloat also signed an open letter from the offshore wind industry to ministers raising concerns about the seabed mining project.

“Granting consent for seabed mining projects in Taranaki Bight would significantly compromise any ongoing investment in South Taranaki offshore wind projects due to the long-term technical and consent constraints that would result from the potential advancement of seabed mining ,” the letter stated. .

“Offshore wind projects are long-term investments that require significant risk reduction during their development phase. With the material risks that potential seabed mining would create, offshore wind investor confidence would be substantially affected by the granting of approvals for seabed mining activity in South Taranaki.”

Despite this, Premier Christopher Luxon earlier this month encouraged offshore wind developers and Trans-Tasman Resources Limited “to come together and figure out how they can co-exist”.

Infrastructure Minister Chris Bishop made similar comments to reporters on Thursday.

“I think it is possible to have seabed mining and offshore wind energy. We are interested in both.”

Woods said there was no place in the world where the two industries co-exist.

“It is a fiction, it is a fairy tale and it is a facade for the fact that this Government has shown no evidence that it has any desire to attract billions of dollars of international investment in a form of renewable energy that is less intermittent than than onshore wind and less intermittent than solar,” she said.

“This is an absolute dereliction of duty by this Government. They are putting the safety and future of New Zealanders at risk.”

In addition to the seabed mining project, delays in setting new regulations to allow offshore wind energy have also frustrated the industry. The newsroom reported in May that the government would not fulfill its election promise that the regulations would come into force within a year. Instead, they will not be finalized until mid-2025.

Energy Minister Simeon Brown said offshore wind legislation will be introduced to Parliament by the end of the year.

“BlueFloat has made the commercial decision to focus its operations in other jurisdictions rather than New Zealand. The government aims to double New Zealand’s renewable electricity generation. That’s why we are moving quickly to ensure there is a favorable regulatory regime for offshore renewable energy in place by mid-2025,” he said.

“This regime will give developers greater confidence and certainty to invest and will allow them to select projects that will bring the greatest benefit to New Zealand. Unfortunately, when we were elected, policy decisions to enable an offshore wind regulatory regime had not been taken and we have since acted quickly to ensure that legislation can be brought before Parliament to enable offshore wind as quickly as possible.