By 2030, the world will have its first two energy islands designed to produce 4 GW power – initially. One of them will be an artificial island in the North Sea named VindØ (“Wind Island”), which will be able to produce 10 GW power long-term.
The finance for the island VindØ will come from the Danish pension funds PensionDanmark and PFA as well as the Danish energy company SEAS-NVE. To this end, they have formed a new consortium to finance and operate the energy island.
“We are initially putting forward a 54 million euro sum to develop the energy island. The energy island is an important part of the economically sound expansion of offshore wind capacity. Moreover, the model of constructing energy islands could transform how the rest of the world plans offshore wind expansions in the years to come,” said Torben Möger Pedersen, CEO of PensionDanmark to State of Green.
The energy island will consist of concrete submersible boxes and will be located 100 kilometres off the Danish coast in the North Sea. The distance ensures that the island will not be visible from the shorelines. However, it will still be close enough to easily supply offshore wind power.
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Vital source of green finance in pension funds
In a time, where investments in the green transition has slumped internationally, the pension funds prove to be a vital source of finance. In Denmark, pension funds such as PensionDanmark and PFA have begun to invest increasingly in green projects, thereby releasing large quantities of much needed finance.
“Denmark is a pioneer in accelerating the green transition and it requires significant investments to meet the ambitious goals the Danish government has set. An offshore wind island in the North Sea will add even more momentum to the green transition, while at the same time creating value for Denmark’s pension savers. That is why we are ready at PFA, together with the others in the consortium, to lift this historic project and thereby ensure that PFA’s 1.3 million customers’ savings are put to best use,” said Kasper Ahrndt Lorenzen, Group Investment Director at PFA in a press release.
Last year during the New York Climate Week, several Danish pension funds, including PensionDenmark and PFA, declared their plans of investing EUR 46 billion in the green transition towards 2030.
“The investment in VindØ is part of the practical implementation of our commitment during the climate action summit. We are supporting the acceleration of the green transition, while expecting a stable long-term return on investment,” said Torben Möger Pedersen, CEO of PensionDanmark.
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Development of VindØ includes Power-to-X
The consortium between PensionDanmark, PFA and SEAS-NVE is based on utilising existing technology within classic Danish positions of strength. A significant expansion at sea with the new energy islands will also reduce the need for onshore wind turbines and solar parks, while also easing the nuisances they might cause in the local areas.
“In the future, the energy needs of society should be covered even more by renewable energy sources if we are to succeed with the green transition. And we should. At SEAS-NVE, we have a long tradition of taking significant co-responsibility for developing the Danish energy system. A development that is driven by strong professional insight. Among other things, this is the knowledge we can bring into play in connection with VindØ. Most recently, we have concrete experience from energy storage experiments,” said Jesper Hjulmand, CEO, SEAS-NVE in a press release.
VindØ will be able to be continuously expanded in line with the development of storage technology or, for example, Power-to-X. The island will also be able to connect to and supply other countries around the North Sea.
Photo: Jan Kopřiva