View from the top: Jon Dobson, Chief Financial Officer at Flotation Energy

Flotation Energy was founded in 2018. What have been its main milestones?

Flotation Energy was developed by the same founders who spearheaded the Kincardine floating wind project, which started producing power in 2018 and is still the world’s largest grid-connected wind farm. Flotation Energy, a separate venture, was created to deliver more pioneering offshore wind projects around the world.

In 2019 we started ornithological studies on sites around the UK. By the end of 2020 we had begun active development of sites in UK, Australia and Taiwan. And in early 2021 we were part of a joint venture that successfully bid for a 480MW site in Offshore Wind Leasing Round 4, Morecambe, and secured outline approval for a 100MW floating project in the Celtic Sea, White Cross.

In the autumn of 2021 we achieved ISO 9001, 14001 and 45001 status, validating our expertise and know-how. This demonstrated our commitment and experience in project execution and commercial deliverability of offshore wind projects.

In November 2022, Flotation Energy became part of the TEPCO Group, Japan’s largest utility company and the fifth largest in the world. This means we can draw on TEPCO’s global utilities technology and experience in delivering our long-term vision to be the leading force in offshore wind. Also in 2022, we formed a joint venture (JV) with Vårgrønn and successfully applied for two sites in the North Sea, Green Volt and CENOS, with a total capacity of 1,910MW of floating wind generation.

Our JV partnership with Vårgrønn has seen us develop our Green Volt project though all consents, as well as being awarded a government Contract for Difference in Allocation Round 6 in 2024. These are huge milestones, with Green Volt on track to be Europe’s first commercial-scale floating project and one of the largest in the world. On our Morecambe development, in a first-of-its-kind project, we are collaborating with bp and EnBW to share a cable corridor for our transmission assets. This was application was accepted in November 2024, and our Development Consent Order for the project was formally accepted in June 2024.

What are your plans for the near future, in terms of growth, innovation, scale-up and strategy?

The business has grown from seven people in 2018 to more than 200 in 2024. We work closely with TEPCO colleagues and share technical expertise to progress our global portfolio and achieve further growth. In the UK, with our JV partners, our projects include:

• Morecambe, a 480MW fixed bottom wind farm 30km off the Lancashire coast
• White Cross, a 100MW floating offshore test and demonstration (T&D) site 52km off the North Devon coast
• Green Volt, a 560MW floating offshore wind farm, decarbonising existing North Sea oil and gas sites
• Cenos, a 1,350MW floating offshore wind farm, decarbonising up to eight North Sea oil and gas platforms.

Our long-term strategy includes a global pipeline of prospects that our early opportunities team is maturing at pace. One of our strengths is our deep understanding of the offshore wind market; we are adept at identifying the right sites and locations, and understanding where we can add value to create commercial advantage.

We are moving into an interesting period for floating wind, where test and demonstration sites are now being developed in parallel with commercial-scale sites

What are the major lessons learnt from the Kincardine Offshore Wind Farm that Flotation Energy can apply to future projects?

Flotation Energy is not part of the Kincardine project, but many of the team involved at the beginning of that project now work for Flotation Energy, including our founders – so we have great technical and commercial understanding of how to deliver floating wind. Numerous technical and logistical challenges had to be overcome, which is typical in any burgeoning industry.  Some lessons you only learn once; with others, such as technology development and implementation, it can be trial and error until it sticks.

Kincardine’s recent success, with the delivery of the first major component replacement delivered in situ on any floating structure, is something the industry will be keen to replicate and finesse.

From a financial perspective, attracting UK-based investment in a niche industry is a challenge. Kincardine had a lot of inward investment and was partly self-funded by shareholders and JV partners. Proving deliverability at Kincardine has opened up more domestic and international interest in floating wind and helped secure commercial confidence. 

The floating industry has since developed more T&D sites, and with those sites comes more knowledge and understanding. There is much more engagement with the investor community, and the industry can now derisk projects further by proving demonstrable evidence and results through T&D sites.

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About Jon Dobson

Jon Dobson is a qualified chartered accountant with more than 20 years’ experience in the renewable energy sector. After training as an auditor, Mr Dobson moved into project finance and spent six years in infrastructure advisory teams at PKF and Grant Thornton. In 2010, he founded a financial advisory consultancy and supported developers to fund, construct, operate, refinance and sell renewable energy projects. He joined Flotation Energy in 2021 as Chief Financial Officer with responsibility for commercial, accounting and financing activities.

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Amid market volatility and economic uncertainties, how does Flotation Energy mitigate risks to make projects more appealing to investors?

The challenges in both fixed and floating offshore wind are well documented, including rising commodity prices, supply chain and port infrastructure bottlenecks and interest rate increases. Flotation Energy is fortunate that wind projects, specifically floating wind, are in our DNA. As such, we believe we are well positioned to use our know-how to identify and mitigate risk, and ultimately deliver reliable best-value projects with a predictable return on investment. 

How significant are the effects of supply chain constraints on projects’ financial feasibility, and how do you navigate this challenge?

The challenge that supply chain constraints represent cannot be underestimated; it affects both the financial and technical feasibility of offshore wind projects. There is no single strategy that will act as a magic bullet to solve all these challenges. From our perspective, it is about collaboration, good planning and trying to be consistent in the messaging on demand to our supply chain. We also have a responsibility to engage with the supply chain to help it understand the challenges we envisage and encourage it to develop cost-effective products and services that represent best value solutions. This will help us overcome these challenges and ultimately enhance the value of our projects and the wider industry.

 

A turbine at Kincardine Floating Offshore Wind Farm

 

What innovative financing mechanisms or partnerships has Flotation Energy explored to enhance the bankability of its projects?

Engagement and collaboration are key. We are moving into an interesting period for floating wind, with T&D sites now being developed in parallel with commercial-scale sites. Some ask why there is still a need for T&D. We believe T&D sites support long-term technological and digital improvements, and can prove technology readiness at a lower risk level than commercial sites that are or will soon be operational. They also stimulate and test the supply chain and infrastructure in specific geographical areas. We need to see more support and investment in our UK T&D sites, as these developments catalyse commercial-scale projects further down the line. If these are not financially viable or become non-investible, the floating industry will suffer.

With Green Volt, developed in partnership with Vårgrønn, we’re delivering the first commercial scale project in Europe, if not the world. Given that we are at the cutting edge of delivering floating offshore wind at this size and scale, we are keen to engage with financial institutions to discuss the challenges and share how we are deploying our know-how to support the wider supply chain. Our aim is to continue identifying, mitigating and ultimately reducing risk for our portfolio, and ensuring these projects are reliable and bankable.

How does the pace of investment in renewables compare to oil, gas and nuclear?

Investment in renewables has accelerated immensely. It’s estimated that global energy investment exceeded US$3tn in 2024, with US$2tn attributed to green energy.  However, the oil and gas sector has traditionally been relatively unaffected by higher interest rates because of its low gearing. Renewables and nuclear power are more exposed to interest rates because of their high capital intensity. It may be that the recent rise in interest rates have a greater effect on the cost of debt for renewables than for traditional energy companies. However, I suspect we will see financial institutions looking to increase their exposure to the interesting pipeline of offshore wind projects during the next decade.

With the new Labour government, are you hearing the right messages from policymakers and seeing the right funding models to meet your strategic goals?

There seems to be strong positive rhetoric around the development of offshore wind projects, which can only be good for the industry. In the UK, the yearly consistency of Allocation Round timings and the Contracts for Difference process have been great tools to facilitate more predictable revenue models, which has helped in investment discussions.

There is also a lot more engagement on the evolution and refinement of these funding models. The new Clean Industry Bonus scheme has been announced and we are interested to see how it works for Allocation Round 7. That being said, consenting processes are still a risk to project delivery, and generation and transmission asset consent needs to be progressed in conjunction and parallel with upgrades to the grid infrastructure.

Collaboration, good planning, and consistency in messaging are crucial to overcoming supply chain constraints

What is your view on Great British Energy, and what would you like it to become and to achieve in the future?

It intrigues me – I think they are still in the process of defining the detail and I am excited to see how it develops. I hope they provide a route to finance for new gateway offshore wind projects that will encourage private sector investment.

What do you want to see from the new National Wealth Fund?

The National Wealth Fund builds on the success of the former UK Infrastructure Bank and is a positive move. We have seen strong examples of the National Wealth Fund and the Scottish National Investment Bank coming together to provide a joint credit facility to support the development of the Ardersier port as an energy transition facility for the offshore wind industry. There are other examples of this sort of positive infrastructure financing, but port development, especially in disadvantaged areas of the UK, will enable more local economic opportunity and create much-needed capacity for the industry.

Is the UK an easy place to do business in?

Yes, the UK is generally considered an easy place to do business. Our engineering capability is globally renowned and we have a ready-made energy-focused supply chain that is ready to support renewable projects, but investment and security is key to facilitate the transition from oil and gas and other traditional energy industries into renewables.

What is the key to unlocking bankability for floating offshore wind projects?

We are on a journey, and it is incumbent on us to help the financial sector understand the risks identified and mitigations in place, so it is comfortable that we are bringing reliable projects with a predictable return on investment to market.

 

 

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Big ambitions for offshore wind

Flotation Energy: Driving the energy transition

A 13GW global pipeline

A robust pipeline of fixed and floating offshore wind developments with a capacity of 13GW worldwide

Decarbonising UK oil and gas

Electrifying participating UK oil and gas platforms through innovative floating wind solutions to significantly reduce emissions

Cutting CO2 emissions

Four UK front-runner projects will mitigate around 4m tonnes of CO2 a year

Economic growth

Green Volt and Cenos, with partner Vårgrønn, will deliver up to 8,300 jobs during construction and several hundred more over the 35-year operation of the wind farms

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With global net-zero targets in mind, how optimistic are you about bridging the current disconnect between ambition and investment in renewables?

It is a challenge, but one that we are excited about. We believe the offshore wind industry has a significant part to play in achieving global net zero targets. However, by engaging with investment institutions and supply chain, we can bridge the gaps in technical understanding for investors and inform the development of best-value products and services to enhance reliability and ensure predictable returns.

Your company is attending and speaking at EIC’s new flagship event Bankable Energies – what are you hoping the event will achieve?

It is about fostering further engagement and alignment. We are keen to hear what ‘bankable’ means to attendees, as I suspect there will be recurring themes but also some interesting differences.

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