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$3B pledge jump-starts massive offshore wind project

$3B pledge jump-starts massive offshore wind project(Via Greenwire)COPENHAGEN -- The world's largest offshore wind farm, the London Array,

will begin construction this summer after the British government doubled

the incentives for offshore wind energy, the project's main owner,

Denmark's DONG Energy, said today.The 1,000-megawatt Thames Estuary behemoth had been in doubt after Royal

Dutch Shell PLC pulled out of the scheme last year because of rising costs,

leaving DONG with a 50 percent stake, Germany's E.ON with 30 percent and

Abu Dhabi's renewable energy fund, Masdar, with 20 percent.Now the three partners have pledged to invest $3 billion for the

630-megawatt first phase of the project, which will be completed in time to

deliver wind energy to the London Olympics in 2012.DONG's CEO, Anders Eldrup, said the U.K. government's announcement last

month of increased support for offshore wind power prompted the consortium

to decide to build the wind park."The decision to build the London Array offshore wind farm is a cornerstone

in DONG Energy's strategy to increase the proportion of electricity

generated from renewable energy sources," Eldrup said. "DONG Energy has

built approximately half of all offshore wind farms in operation in the

world today."The British government provided £525 million in the 2009 budget for

offshore wind subsidies between 2011 and 2014 by increasing the number of

renewables obligation certificates, or ROCs, available for offshore wind

generation. The United Kingdom already has the most installed offshore wind

power generation capacity in the world.ROCs are the main support scheme for renewable electricity projects in the

United Kingdom. It places an obligation on U.K. suppliers of electricity to

get an increasing proportion of their electricity from renewable sources --

from 9.7 percent this year to 15.4 percent by 2016. Suppliers meet their

obligations by presenting ROCs or by paying into a buyout fund.Under the new rules, the government will issue two ROCs for every

megawatt-hour of offshore wind power produced, doubling the original

incentive. A further £405 million in the budget were earmarked for "the

development of a world leading low-carbon energy and green manufacturing

sector in the U.K.," something that analysts expect will benefit mainly

wind and tidal power and should kick-start the 8,000 megawatts of various

U.K. wind power projects that have secured approval but have not started

construction. Without the increased incentives, the London Array would not

have been economical, analysts said."The London Array is a flagship project in our drive to cut emissions by 80

percent by 2050 and meet future energy needs," said British Prime Minister

Gordon Brown in a statement. "The U.K. is a world leader in offshore wind

farms, creating jobsand prosperity for the economy. That's why we have

increased our support for this technology as we move toward a low carbon

future."Masdar's CEO Sultan Al Jaber also praised the government's involvement.

"The London Array represents Masdar's strategic approach to renewable

energy, whereby real partnerships are formed between government and the

private sector," he said in a statement. "This project is a great

achievement for the U.K. government, E.ON, DONG Energy and Masdar, which

exemplifies our commitment to build cooperation to take renewable energy

further down the path to widespread global adoption."The London Array wind farm will be built on a 90-square-mile area that will

be 12 miles off the coasts of Kent and Essex.The first phase will consist of 175 turbines built by Siemens AG. The

second phase will take the farm to 1,000 megawatts, or enough power for

750,000 homes -- a quarter of Greater London homes -- and displace the

emission of 1.9 million tons of carbon dioxide emissions every year,

according to project planners. But the investment decision to build the

second phase will be taken separately and depends on