'France's South Brittany project is a global reference for floating wind power'

The South Brittany AO5 tender, won by Pennavel (an Elicio-BayWa r.e. consortium), is the world’s first commercial floating offshore wind project to be awarded an exclusive concession of the maritime public domain, a tariff indexed to inflation and a secured grid connection.

This triple combination significantly de-risks the project's development and sets a worldwide reference for the sector, allowing it to seek competitiveness in pricing and to drive progress across the entire market.

In France, offshore wind tenders, whether bottom-fixed or floating, are allocated through long-term Contracts for Difference (CfD). Pennavel was therefore the first commercial floating wind farm in the world to be awarded with such a route-to-market.

Together with exclusivity on seabed rights, the project benefits from a secured grid connection with RTE, the French transmission system operator, which is responsible for delivering and operating the transmission assets including the offshore substation and export cables.

The rules for the French AO5 tender, which was held for 230-270MW of capacity, also incorporated a tariff both indexed to inflation and protected against interest rate variation, showing that French allocation processes are much more advanced, and scopes go far beyond that of other markets.

Another difference when it comes to France is the massive investment planned in regional and national ports. As an example, the shareholders of the Port of Brest, comprising the Brittany Region, Brest Métropole, and the Western Brittany Metropolitan Chamber of Commerce and Industry have signed an agreement to invest €900m over forty years in projects primarily centred on the energy transition, with a particular emphasis on positioning the port as a key player in floating wind power. Some €500m will be poured into its development over the first ten years.

'Not a random calculation'

Setting a tariff – Pennavel's was €86.45/MWh ($96.1/MWh) – isn’t the result of a random calculation; it’s the outcome of a thorough and reasoned approach based on experience and expertise. Elicio and BayWa r.e.’s offer has been developed and rigorously structured by the consortium’s experienced teams alongside multiple expert advisors and an extensive offshore wind network, resulting in a particularly solid and well-founded project, both technically and economically.

Site conditions are equally crucial to determine a tariff. From this perspective, the site off the coast of South Brittany is favourable, benefiting from abundant wind resources and shallow waters. Other areas in Europe share similar advantages, with the Mediterranean leading the way.

In terms of industrial strategy, Elicio and BayWa r.e.’s aim is to develop the project in close consultation with the local supply chain and ports, according to their specificities and with the ambition of maximising economic benefits and local jobs, while ensuring the robustness of the project.

The consortium engages closely and in a long-standing and proven relationship with their industrial partners, particularly turbine suppliers, across their hundreds of megawatts of onshore and offshore projects in Europe.

However, the final wind turbine model, best suited to the site and project specifics, is still being determined. When looking at the development and learning curves of wind turbine platforms across the past decade, as well as the ambitious floating wind development targets worldwide, and in particular in Europe, the consortium is confident that European turbine suppliers will be in a position to supply a model fit for the project’s requirements.

It should also be noted that the provision of wind turbines represents a limited share of the Capex of a floating wind project, with Capex itself being only a part of the calculation of an optimum electricity tariff.

Focus on positive impact

The real focus is now on ensuring that projects have a genuine positive impact on the French regions, France, and Europe. The Elicio and BayWa r.e. consortium has made its ambition for local content a major factor in their development of the French project.

During the tender phase of almost three years, Pennavel has been conceived in close consultation with local stakeholders, such as ports, professional fishermen, environmental associations, regional clusters and the industry value chain.

This close dialogue will be expanded with the aim to maximise local content and local jobs. In 2023, Elicio and BayWa r.e. received the 'Breizh Content' label from Bretagne Pôle Naval, the regional cluster, recognising their commitment to fostering a local industrial sector.

The public reaction of many stakeholders in Brittany following the Pennavel award also confirms strong local support to the project.

For future auctions, both Elicio and BayWa r.e. fully support the Net Zero Industry Act's target that by 2030 at least 40% of annual installed capacity (around 36GW for wind and 30GW for solar) should be produced in Europe.

However, it will significantly change the design of the auctions and Member States will need to consider this carefully. We now need to ensure that the implementing legislation expected by Q1 2025, and more generally the guidance from the EU Commission, does not make the pre-qualification and non-price award criteria too difficult to implement, so as not to slow down the pace of wind energy deployment whilst ensuring fair competition. These criteria need to be objective and easily measurable.