IKEA unit swoops for floating wind pioneer's stake in giant projects
Retail giant's owner and developer take Hexicon half-share as Italy gears up for auctions
The investment arm of the IKEA-owning Ingka group and French renewables developer Oxan Energy have acquired Swedish floating pioneer Hexicon’s 50% stake in two giant floating wind projects in southern Italy.
NexVenti, as the joint venture between Ingka Investments and Oxan Energy is known, will develop the two floating projects together with local partner Avapa Energy, according to a statement by the partners.
The 1.2GW Sicily South wind farm and the 1.3GW Sardinia Northwest array are currently proceeding with their environmental impact assessment processes.
NexVenti and Avapa said they will further develop the two projects, aiming to participate in the revenue support auction, with the objective to build and operate the projects.
Hexicon built up its position in the two proposed floating offshore wind projects in 2021 through its own 50/50 joint venture with Avapa Energy, called AvenHexicon.
These plans received a fillip last August, when Italy's FER 2 renewable energy decree entered into force, putting in place a Contracts for Difference scheme that will be awarded through public auction over the next four years.
During this time, up to 3.8GW will be allocated to both floating and fixed bottom offshore wind projects together.
Revenue support is available subject to a strike price cap initially set at €185/MWh, applicable to both categories.
The Italian government's national climate action plan sets an offshore wind capacity target of 2.1GW by 2030, but independent studies suggest that Italy can become of the leading European markets for floating offshore wind in the subsequent decades.
But Hexicon has run into financial difficulties recently.
Hexicon secured just €2.5m ($2.7) from divestment of the two Italian assets, but with milestone payments promised at environmental impact assessment approval and offtake auction and/or a final investment decision, up to a total potential consideration of up to €20m.
The company said it was stepping away from the projects as they entered the first “cost-driving” phase that requires significant capital and resource investments.
"We are very pleased to make this announcement, as it confirms both our business model and that we have built an attractive project portfolio”, said Marcus Thor, CEO of Hexicon. “We are confident that Ingka and Oxan are an ideal match to drive these two projects through to commercialisation."
Following the divestment, Hexicon stressed there are still five floating offshore wind projects in AvenHexicon’s portfolio.
“Hexicon will continue its project development in Italy through AvenHexicon to build value in its portfolio,” the company stated.