The Crown Estate has reported a £210 million operating profit from its Welsh assets for the financial year 2025/26, down slightly from £253.4 million the previous year. The vast majority of this year's profit—approximately £200 million—came from option fees paid by companies developing the 1.5 GW Mona offshore wind farm in the Irish Sea, about 30 km off the north Wales coast. Mona is a joint venture that includes oil giant BP.
Option Fees Drive Profits, but Are Time-Limited
The option fees were time-limited and ceased after Mona entered its pre-generation phase earlier this year. Excluding these fees, the Crown Estate said its operating profit in Wales would have been just £9.8 million. The project is part of the Crown Estate’s offshore wind leasing round four and is 87% within Welsh waters.
The Crown Estate's Welsh assets include renewable energy licences, development rights for offshore wind and tidal projects, seabed leases for oil and gas pipelines, marine aggregates, subsea cables, and interconnectors. It manages about 65% of the foreshore and tidal riverbed, and around 50,000 acres of common land used for grazing.
Calls for Devolution Intensify
There are continued calls for the profits from the Crown Estate's Welsh assets to go directly to the Welsh Government, as happens in Scotland. Wales' new Plaid Cymru government and the previous Labour administration of Eluned Morgan have both advocated for devolution. The UK government has steadfastly declined these requests.
Since Crown Estate Scotland was devolved in 2017, its profits have boosted the Scottish Government’s budget. In 2024/25, Crown Estate Scotland posted its highest ever net profit of £130 million, distributed to the Scottish Government’s consolidation fund. However, the UK Treasury is increasing deductions from Scotland's block grant to account for these profits—£15 million this year, rising to £40 million by 2028/29, after which it will remain flat and unindexed. Any devolution of Crown Estate assets in Wales would likely include a similar mechanism.
Celtic Sea Floating Wind Farms and Investment
The Crown Estate’s assets in Wales were valued at £290 million for 2025/26, a 22% year-on-year increase following the awarding of development contracts for three floating offshore wind farms in the Celtic Sea under leasing round five. However, the auction set option fees at just £1.6 million, reflecting challenging global market conditions and the less mature technology of floating offshore wind. Only one of the three projects is solely in Welsh waters off Pembrokeshire; another straddles the Welsh-English border, and the third is in English waters. The three schemes are projected to create 5,000 jobs with an economic impact of £1.5 billion, but are not expected to be operational until the mid-2030s.
Since 2024, the Crown Estate has invested £18 million in UK offshore wind supply chain projects, including £5 million for the Celtic Sea floating wind farms. Seven projects in Wales have benefited from this investment, part of a wider £400 million commitment.
Dan Labbad, chief executive of the Crown Estate, said: “This has been an important year of progress for The Crown Estate in Wales, as we continue to grow our ambitions for offshore wind and the marine economy across the nation. Over the past few years, we have made significant strides to strengthen our operations through local partnerships, investment and engagement. Securing agreements for three floating offshore wind projects in the Celtic Sea reflects these efforts, with the potential to create over 5,000 jobs and contribute £1.4 billion to the wider economy.”
New Commissioner and Borrowing Powers
The Crown Estate has appointed Welsh entrepreneur Michael Plaut as a new commissioner to its board, increasing the number of commissioners from eight to 12 following the Crown Estate Act 2025. Plaut, who lives in Cardiff, started his career as an investment banker in London before returning to Wales to lead family-owned business Northmace. He is also a non-executive director for Wales on the BBC board and chairs the Royal Welsh College of Music & Drama. Ric Lewis, chair of the Crown Estate, said: “It’s fantastic to be welcoming Michael to the Crown Estate board. Michael’s depth of experience across business, public service and cultural institutions, combined with his deep connection to and understanding of Wales, will be a valuable addition.”
The Crown Estate Act 2025 also gives the body the ability to borrow against its asset base, though the amount has yet to be determined. The Crown Estate is working with the Treasury to finalise a detailed framework governing borrowing, including controls, approval processes, and financial parameters. If the Crown Estate were devolved to Wales, the Welsh Government would likely seek similar borrowing powers.
However, on a per capita basis, borrowing against Welsh assets might yield less for Wales than under the current England and Wales arrangement, given that the Crown Estate’s lucrative London property assets—including Regent Street and St James’—are valued at £7.1 billion alone. The Welsh Government would be powerless to prevent an unfair allocation from Crown Estate borrowings against assets, unlike the historic underfunding of non-devolved rail enhancements in Wales.
