Regent Street is one of the most iconic shopping destinations in the world. The grand, curving street is home to Apple’s flagship store, as well as storied London shops like Liberty and Hamleys. And almost all of it belongs to King Charles III. Or, to be more precise, the Crown Estate—the commercial real estate business that owns and manages vast swaths of land and property belonging to the British monarch.
The Crown Estate’s property empire includes Twitter’s London HQ, multiple shopping centers, and the Ascot racecourse, but its dominion extends well beyond the shores of England, Wales, and Northern Ireland. Since 1964, the Crown Estate has laid claim to the UK’s entire continental shelf, reaching hundreds of kilometers into the sea, and with it the right to grant permissions to build offshore wind turbines, lay pipelines, and store carbon under the seabed.
For years, the seabed was a sideshow to the royal family’s sprawling terrestrial property empire. But over the past few years it’s leapt in value, as a result of the booming market for renewable energy. After rising incrementally for years, the value of the seabed doubled between 2020 and 2021. By 2022, the Crown Estate estimated its marine portfolio was worth £5 billion ($6.3 billion).
Globally, there has been a dramatic acceleration in ocean-based industries, with the OECD projecting that the ocean economy could exceed $3 trillion by 2030. But the UK, with its 29,000 kilometers of coastline, has been an early mover in commercializing its coastal waters beyond the traditional sectors of oil and gas, seafood, and shipping. The Crown Estate has facilitated and profited from much of this new activity, working in tandem with the government to rent out areas of ocean to companies that want to install offshore wind turbines, dredge up sand and gravel for the construction industry, lay cables for internet traffic and electricity, or build pipelines for oil and gas. It’s also responsible for handing out the rights to store carbon—a potentially lucrative future industry.
Not all the money generated by the seabed around England, Wales, and Northern Ireland funds the royals. A quarter of the Crown Estate’s profits goes to the British monarchy via a system called the sovereign grant, while the rest flows into the public purse through the finance ministry. Scotland has a different system, where the government takes 100 percent of the profits generated by the Crown Estate Scotland, a separate entity. But as King Charles officially takes the throne on Saturday, the monarch will preside over a royal family that is partly funded by a new era of ocean industry.
During King Charles’ tenure, Crown Estate commissioners will make decisions that will permanently change Britain’s seabed—choosing which companies and industries get priority in an increasingly busy sea. Already, the high cost of leasing the seabed to develop offshore wind projects is shutting small companies out of the process. And as competition to store carbon under the sea heats up, there is a danger that the new seabed economy will look disturbingly similar to the old one, with a handful of oil and gas giants dominating and locking in a future based on fossil fuels.
“The Crown Estate is turning the seabed into a major source of rental income for the Crown Estate,” says Guy Standing, a professor at the School of Oriental and African Studies in London and author of the book, The Blue Commons: Rescuing the Economy of the Sea. “Billions and billions of pounds.”
The monarchy hasn’t always claimed ownership of the seabed. When oil and gas were discovered off Britain’s east coast, companies eager to start drilling demanded clarity on whose property, exactly, they were about to bore into.
To them, the assertion by then foreign secretary Herbert Morrison that it was res nullius—Latin for nobody’s property—sounded like a legal gray area. So in 1964 the government passed the Continental Shelf Act, effectively passing ownership of the UK seabed to the business managing the rest of the monarchy’s property portfolio from that point onward. “Everything in the marine environment, in the absence of anyone else owning it, belongs to the Crown Estate,” says Thomas Appleby, a lawyer and academic specializing in marine law at the University of the West of England in Bristol.
It wasn’t until the turn of the millenium that the Crown Estate launched what would become its most profitable seabed industry. In 2000, the first two offshore wind turbines were installed on the seabed, near the English city of Newcastle. Since then, the UK’s offshore wind industry has grown massively, providing almost a quarter of the country’s electricity last year, and it is now second only to China’s in size. Today there are more 2,700 wind turbines off the country’s coast. The world’s biggest offshore wind farm—the size of 66,000 soccer pitches—is situated 70 miles off the coast of Yorkshire, in the northeast of England.
“The Crown Estate saw an opportunity in this very early on,” says Ben Backwell, CEO of the Global Wind Energy Council, which represents the offshore wind industry. “They didn’t just lease the seabed, they played a really proactive role in developing it,” he adds. That development is just getting started. The UK is planning for a massive, fivefold increase in offshore wind capacity to 50 gigawatts by 2030.
So far, the Crown Estate has held four major auctions, where companies bid for the rights to build wind farms on designated sections of seabed. As the technology evolves, each auction allows wind farms to build bigger turbines that are installed farther out to sea. The offshore wind market has become so competitive that the Crown Estate is now in a position to charge companies enormous option fees—just to reserve the right to build on the seabed.
Marcus Thor, CEO of Swedish floating wind company Hexicon, says that these auctions price out all but the largest bidders, often oil and gas majors or giant utility companies. “A company like Hexicon cannot participate, because they cost too much,” Thor says.
In 2019, a partnership between BP and German energy provider ENBW agreed to pay £231 million ($290 million) in annual option fees alone.
While the offshore wind industry booms, the Crown Estate is already eyeing the next opportunity to cash in on its seabed empire: carbon storage. The seabed around the UK has room to store 78 billion tons of carbon dioxide—more than enough space to cram in 200 years’ worth of the country’s annual emissions. Increasingly, the North Sea is being seen as a destination to store carbon captured from hard-to-decarbonize industries, including steel, cement, and fertilizer production.
“As the science on climate change has progressed, we’ve come to realize that just decarbonizing the power sector itself is not enough. We also need to reduce emissions and decarbonize other industries, other sources of emissions,” says Jonathan Pearce, carbon dioxide storage team leader at the British Geological Survey.
Although it’s still the heart of the UK’s fossil fuel industry, the North Sea may come to play an important part in the country’s decarbonization plans. In 2019 the Committee on Climate Change—a public body that advises the government—concluded that carbon capture and storage is a “necessity, not an option” if the UK is going to achieve its legally binding goal of reaching net zero greenhouse gas emissions by 2050.
But carbon storage plans have had a rocky start, says Esin Serin, a policy analyst at the Grantham Research Institute on Climate Change and the Environment at the London School of Economics. In 2011 and 2015 the government canceled major carbon capture and storage projects, attracting criticism from those who say the UK has been slow to capitalize on its natural storage assets. That is starting to change. The government’s pledge to hit net zero carbon emissions “was a turning point for carbon capture, usage, and storage,” says Serin.
The UK has set itself the target of capturing up to 30 million tons of carbon dioxide every year by 2030, with the first carbon capture clusters centering around industrial towns and cities in the northeast and northwest of England. “There’s now a real global competition for who’s going to reap the industrial and economic benefits from the world effort to try and get to net zero emissions,” Serin says.
All of that means the Crown Estate is now sitting on another valuable asset deep beneath the sea. The estate is responsible for granting the rights for carbon storage under the seabed around England, Wales, and Northern Ireland, as well as leases for pipelines that would transfer carbon dioxide to these underground stores, most of which are located in the North Sea. Storage licenses are approved by the North Sea Transition Authority (NSTA), a public body that regulates the oil, gas, and carbon storage industries in the North Sea.
So far, the NTSA has granted seven licenses for seabed carbon storage around England. One of those licenses—granted in 2013 to Shell—has expired, so there are now six active carbon storage licenses, covering five sites in the North Sea and one in the Irish Sea to the west of England. In September 2022, the NSTA closed bidding on the first public round of carbon storage licensing after receiving bids from 19 companies for the 13 carbon storage sites offered up. But any company that wants to transport and store carbon under the sea will also need to purchase rights from the Crown Estate. So far only one project holds an agreement for lease from the Crown Estate: a chunk of the North Sea being explored by a partnership between BP, Carbon Sentinel, and Equinor New Energy for its carbon storage potential.
The seabed “is now facing a moment of transition. Its exciting potential to support nature recovery, unlock huge opportunity for renewable energy, and play a major role in energy security means it is becoming increasingly busy, with more demands on it than ever before,” wrote Gus Jaspert, the Crown Estate’s managing director of marine in a statement emailed to WIRED. “These demands are set to intensify, which means we need to achieve even more than we have in the past.”
As with offshore wind farms, this raises the question of who gets to cash in on the race to net zero. Of the six active carbon storage licenses granted on the UK continental shelf, five of them are owned by oil and gas companies. A freedom of information request submitted to the NSTA by WIRED revealed that prior to September 2022, there had only been nine applications for offshore carbon storage licenses. In other words, almost every single carbon storage application was successful, and all but one of those licenses went to an oil or gas company.
This isn’t totally surprising, Pearce points out; storing carbon under the sea means drilling wells hundreds of meters under the seabed, exactly the kind of thing that oil and gas companies have been doing in the North Sea for decades. But these companies have another incentive to encourage carbon capture and storage: If the technology is used as a way to reduce emissions from fossil fuels, then it could be used to justify continued drilling for oil and gas in the North Sea. The NSTA has already licensed new areas for oil and gas exploration in the North Sea, a move decried by some campaign groups as illegal.
“We can say with confidence that what we don’t need is carbon capture, usage, and storage to keep the fossil fuel industry alive,” says Mike Childs, head of science, policy, and research at Friends of the Earth, one of three groups lodging a legal challenge against the oil and gas licensing plans. “You’ve got that big dirty oil hand of the industry on there at the same time as they’re underinvesting in the transition to green energy,” he says.
The transition to a lower-carbon economy will mean finding new uses for the ocean, but there are still serious questions over the impact that marine industries have on the seabed, and about which companies will profit from this new undersea boom. In the Pacific, mining firms are exploring the seabed for polymetallic nodules packed with metals that are essential for manufacturing electric cars. Starting in July 2023, the International Seabed Authority will start taking applications from companies that wish to mine the ocean floor. A whole new era of ocean exploitation beckons—this time in the name of limiting carbon emissions and adapting to climate change.
But for years, the ocean has suffered as a result of human activity. Marine heat waves have prompted coral bleaching, microplastics are messing with ocean food chains, and falling underwater oxygen levels mean marine animals are finding it harder to breathe. “Human influence has not been good for the ocean,” says Jean-Baptiste Jouffray, a sustainability science researcher at Stockhom’s Resilience Centre and Stanford University.
Jouffray and others are worried that the rush to commercialize the seabed threatens to repeat mistakes made on land, where a small handful of companies work according to an extractivist mentality. The stakes are huge, says Jouffray. “To me. It’s one of the greatest challenges of the 21st century.”
CORRECTION 05/05/2023 6:20 ET: This article has been updated to reflect that Crown Estate Scotland is a separate entity from The Crown Estate.