Wind farm in the North sea off the coast of United Kingdom. File photo: Riekelt Hakvoort/Shutterstock
LONDON, July 24 (Reuters) – Britain’s Crown Estate, which manages King Charles’ public property, posted a record profit for 2023/24 of 1.1 billion pounds ($1.42 billion), boosted by income from offshore wind leases, its results showed on Wednesday.
The Crown Estate, which comprises tracts of land and most of Britain’s sea bed, is an independently run, commercial business, whose profits go to the Treasury.
They are also used as the benchmark for the level of public funding for the Royal Family.
Crown Estate’s net revenue profit reached 1.1 billion pounds for April 2023-March 31 2024, up from 442.6 million pounds for the same period in 2022/23 as it generated bumper revenue from an offshore wind farm lease tender held in 2021 called round 4.
Under the lease, companies pay for the right to build offshore wind projects with option fees across six winning projects worth approximately 1 billion pounds per year, payable for a minimum of three years and up to 10 years.
Dan Labbad chief executive of the Crown Estate said the high prices achieved in round 4 were unlikely to be sustained in future licensing rounds.
“Round 4 was in a very different economic moment to today… inflation is up interest rates are up… and we have a responsibility to ensure we are supporting the market,” he said in a briefing with journalists.
The new Labour government last week proposed changing rules to allow the Crown Estate to borrow money to invest.
Labbad said this would give the organisation greater flexibility in the way it supports renewable projects and invests in its property portfolio in London to make sure it remains attractive.
Britain’s monarchy receives a Sovereign Grant to cover the running costs of the royal households and travel expenses. It is set at 12% of the profits from the Crown Estate for 2024-25, down from 25% in 2023-24 largely due to the large increase in revenues from offshore wind.
The overall amount of the Sovereign Grant for 2024-25 will remain at 86.3 million pounds for the third consecutive year, Britain’s Treasury said in July last year.
($1 = 0.7744 pounds)
(Reporting by Susanna Twidale; Editing by Susan Fenton)
(c) Copyright Thomson Reuters 2024.
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