LONDON Denmark's DONG Energy (DENERG.CO) has made a multi-million pound investment in a Scottish factory making offshore wind turbine towers which is now owned by Korea's CS Wind (112610.KS), it said on Thursday, in return for exclusive access to supplies.
The factory in Campbeltown will be the first in Britain to make such towers and DONG Energy said it will use them in the expansion of its Walney offshore wind farm in the Irish Sea and its Hornsea Project One farm in the North Sea.
Siemens (SIEGn.DE), which is DONG's turbine supplier for these projects, will take delivery of the first 95 towers to be built in the factory.
"Developing the supply chain in the UK is a strategic priority for DONG Energy," said Brent Cheshire, head of DONG Energy's business in Britain.
Britain is the world's biggest offshore wind market and with further projects in the pipeline, turbines at sea are expected to provide around 10 percent of Britain's annual electricity demand by 2020.
As other European countries like Germany, the Netherlands and Denmark start building their own offshore wind projects, competition for equipment is heating up.
The British government supports offshore wind projects through subsidies and in return wants the growing industry to contribute as much as possible to the British economy.
"This inward investment drives forward positive local supply chain partnerships like this between DONG Energy and CS Wind," said Britain's Energy Minister, Baroness Neville Rolfe, in a statement.
(Reporting by Karolin Schaps; Editing by Greg Mahlich)