King pledges a windfarms windfall for the taxpayer after Crown Estate signs £10bn offshore deal
- He wants windfall from lease agreements to ‘be directed for wider public good’
- The King is entitled to receive 25 per cent of all profits from the Crown Estate
- The six offshore wind leases are expected to add £1billion to annual revenues
- Schemes are expected to produce enough electricity to power 7million homes
The Crown Estate has signed a deal worth up to £10billion giving energy companies the right to build offshore windfarms – but the King claims he does not want to profit.
Charles, who is an avid supporter of both onshore and offshore wind power, said he wants the windfall from the bumper lease agreements for six new windfarms to ‘be directed for wider public good’.
Under current arrangements known as the Sovereign Grant, the King is entitled to receive 25 per cent of all profits from the Crown Estate. The rest is kept by the Treasury.
Last year the Sovereign Grant was £86.3million, based on the Crown Estate’s £345million profits notched up in 2019/20.
The Crown Estate has signed a deal worth up to £10billion giving energy companies the right to build offshore windfarms – but the King claims he does not want to profit
He said he wants the windfall from the bumper lease agreements for six new windfarms to ‘be directed for wider public good’ (stock image)
The six offshore wind leases are expected to add £1billion to the Crown Estate’s annual revenues from 2024 for at least three years up to a maximum of ten years.
The leases were provisionally handed out two years ago, before the current cost-of-living crisis took hold, the Telegraph reports.
For the year to the end of March 2022, the Crown Estate generated revenues of nearly £491million, meaning the additional income could see this figure more than treble.
But Buckingham Palace has said King Charles wants the percentage of Crown Estate profits paid to him to be reduced from 25 per cent to a lower figure so the public reaps the benefits.
The decision to reduce the percentage paid to the monarch and by how much is not made by the King but by the trustees of the Sovereign Grant: the Prime Minister, the Chancellor and the Keeper of the Privy Purse, Sally O’Neill.
The new funding arrangements for the Sovereign Grant will be announced later this year.
The revenue boost is likely to net a large windfall for taxpayers as the Crown Estate’s profits are paid into the Treasury’s coffers for ‘the benefit of the nation’.
Over the past ten years, the revenue paid to the Exchequer is £3billion.
In the King’s first Christmas message, he made clear he was aware of the financial hardship faced by many
A Buckingham Palace spokesman said: ‘The Keeper of the Privy Purse has written to the Prime Minister and Chancellor to share the King’s wish that this windfall be directed for wider public good, through an appropriate reduction in the proportion of Crown Estate surplus that funds the Sovereign Grant.’
In the King’s first Christmas message, he made clear he was aware of the financial hardship faced by many.
The Sovereign Grant was originally set at 15 per cent of the Crown Estate surplus. An additional 10 per cent was agreed for ten years from 2017/2018 to fund the renovation of Buckingham Palace.
The Crown Estate manages the seabed around England, Wales and Northern Ireland and so plays a key role in the UK’s offshore wind industry.
Overall, the Crown Estate has awarded rights to build wind farms around the UK totalling 41 gigawatts of power – more than four fifths of the Government’s target of getting offshore wind capacity up to 50 gigawatts by 2030.
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Dan Labbad, the chief executive of the Crown Estate, said: ‘The UK’s offshore wind achievements to date are nothing short of remarkable, and this next generation of projects points to an even more exciting and dynamic future.’
He added: ‘They demonstrate the far-reaching value that our world-class offshore wind sector can deliver for the nation: home-grown energy for all, jobs and investment for communities, revenue for the taxpayer, clean energy for the benefit of the environment.’
Three of the new windfarms are off the North Wales, Cumbria and Lancashire coast, and three in the North Sea off Yorkshire and Lincolnshire.
The giant wind farms will provide around eight gigawatts of electricity – enough for seven million homes.
Dan McGrail, chief executive of trade body RenewableUK, said: ‘This announcement represents a major step forward not just for these major offshore wind projects but also for the industry as a whole, as these lease agreements will strengthen our energy security, create jobs and support development of new UK supply chains.
‘It demonstrates the continuing ability of the UK to attract billions of pounds in private investment due to the maturity of our world-class offshore wind market, which is enabling the redevelopment and regeneration of all areas of the UK, especially in coastal communities which need levelling up.
‘Offshore wind is playing the leading role in the UK’s transition to clean power, becoming the backbone of our future energy system, and helping us to reach net-zero as fast as possible.’
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