The investment arm of the owner of Swedish furniture giant Ikea has made what has been described as a “transformational” investment in offshore wind in the UK and Ireland.
Ingka Investments, part of the Ingka Group, has bought a 20% stake in the offshore wind project portfolio of Source Galileo. The Dublin-based company is developing 10GW of offshore wind off the north-western coasts of Europe that it plans to use for electricity and hydrogen production.
Ingka's investment is “transformational” for offshore wind in the UK and Ireland, said Source Galileo CEO Kevin Lynch, announcing the news on Monday.
The UK has committed to deploy 50GW of offshore wind by 2030, up from 14GW now. Ireland too is expected to develop at least 20GW of offshore wind by 2040.
Lynch said the commitment from Ingka to “help deliver on these targets is enormous.”
The investment will be much welcome in the UK offshore wind sector, which has been hit hard by spiralling inflation and supply chain issues.
Vattenfall pulled out of its 1.4GW Norfolk Boreas project citing a “perfect storm” of issues. Offshore developers were then a no-show at the UK’s calamitous green energy auction due to the poor power price on offer.
Frederik de Jong, head of renewables at Ingka, said the partnership “is a further step to expand our investment activities to address climate footprint reduction well beyond our retail consumption, and into the IKEA value chain.”
“We are looking forward to working closely with Source Galileo to make a significant contribution to the achievement of Ireland, the UK, and Europe’s decarbonised energy goals,” he added.
Source Galileo said this latest investment is part of Ingka’s €6.5bn ($6.9bn) initiative to “support 100% renewable energy consumption across the IKEA value chain and beyond.” It added that Ingka has invested and committed more than €4bn into renewable energy projects to date.
Speaking in an interview with Recharge last month, De Jong said that Ingka plans to expand its offshore wind activities to Asia and further European countries. It is however steering clear of markets that include negative bidding in their allocation systems and is “not looking at North America at this point.”
Ingka recently entered Norway’s race to deploy floating wind, joining the UtsiraVIND consortium of companies – which includes Source Galileo – bidding in a tender process underway as part of the Norwegian government’s first award of large-sale offshore wind leases.
