Offshore wind: a blow to UK policy
Britain's failed offshore wind auction debacle 'highlights an inconvenient truth'
It can feel as if Britain isn't much good at anything any more, but when it comes to the offshore wind industry, this country is a true "global powerhouse", said Ben Marlow in The Daily Telegraph.
The UK's 44 offshore sites – made up of over 2,500 vast turbines up to 260 metres high – accounted for 27% of its electricity generation last year. In terms of installed capacity, Britain, with its long coastline, shallow sea beds and good wind speeds, is second only to China. But this leading position is now under threat, "thanks to the absolute shambles that was the latest auction for renewable contracts".
Seven projects were eligible, with potential to power an estimated eight million homes; but in the event, not a single bid was submitted, for the simple reason that the price cap for the auction was set too low, at £44/MWh in the 2012 prices that are used in such contracts. (This represents the maximum unit price the developers could bid to receive for the electricity they produce.) Given the soaring cost of everything from steel and labour to debt, that just wasn't feasible.
Subscribe to The Week
Escape your echo chamber. Get the facts behind the news, plus analysis from multiple perspectives.
Sign up for The Week's Free Newsletters
From our morning news briefing to a weekly Good News Newsletter, get the best of The Week delivered directly to your inbox.
From our morning news briefing to a weekly Good News Newsletter, get the best of The Week delivered directly to your inbox.
A real embarrassment
The botched auction is a real embarrassment for a government that has made offshore wind the backbone of its green energy policy, said Max Mitchell on Reaction. Ministers have committed to increasing the amount of electricity the grid receives from offshore sites from 14GW now to 50GW in 2030; and this is central to its target of decarbonising electricity production by 2035.
Even if a better deal can be agreed for the next auction, the zero bids represent a "significant setback" for that timeline. Ministers can't even say they weren't warned: the Swedish company Vattenfall recently cancelled work on a new windfarm off Norfolk, citing its 40% increased costs. Industry leaders had stressed before the auction that they'd need higher subsidies to offset the impact of inflation.
An inconvenient truth
We've been sold the idea that offshore wind energy is cheap and secure as well as green; but this debacle "highlights an inconvenient truth", said The Daily Telegraph: building the farms and getting the energy to the grid is very expensive, and reliant on subsidies (funded via energy bills). Consumers are entitled to ask if they're getting good value for money.
True, wind power is not cheap, but it is still cheaper than gas, said Will Dunn in The New Statesman, and likely to remain so for some years. And if voters baulk at the idea of foreign-owned operators receiving ever-larger subsidies, there are ways of assuaging this, said Nathalie Thomas in the FT. The firms could, for instance, be obliged to source more components in the UK. The bottom line, though, is that if it is to hit its renewables targets, the Government will have to move on price.
Create an account with the same email registered to your subscription to unlock access.
Sign up for Today's Best Articles in your inbox
A free daily email with the biggest news stories of the day – and the best features from TheWeek.com
-
Italian senate passes law allowing anti-abortion activists into clinics
Under The Radar Giorgia Meloni scores a political 'victory' but will it make much difference in practice?
By Chas Newkey-Burden, The Week UK Published
-
Magazine interactive crossword - May 3, 2024
Puzzles and Quizzes Issue - May 3, 2024
By The Week US Published
-
Magazine solutions - May 3, 2024
Puzzles and Quizzes Issue - May 3, 2024
By The Week US Published
-
Pros and cons of solar energy
Pros and cons Solar power could become the primary source of electricity worldwide by 2050 – but there are still clouds in the forecast
By Rebecca Messina, The Week UK Published
-
Is America running out of electrical power?
Today's Big Question The nation's power grid appears to be reaching critical levels due to emerging technologies
By Justin Klawans, The Week US Published
-
Gold hydrogen: a near limitless supply of clean fuel?
Under The Radar Huge deposits found in northern France but major energy companies are holding back, for now
By Chas Newkey-Burden, The Week UK Published
-
The push for net zero
The Explainer Britain has committed to reaching net-zero carbon emissions by 2050. What will this involve?
By The Week Staff Published
-
Japan's new solar panel technology might forever alter the renewables market
Under the radar All thanks to perovskite solar panel technology
By Devika Rao, The Week US Published
-
Can the world really wean itself off coal?
Today's Big Question 'Record' global consumption is set to fall soon but growing demand in China and India could increase tensions
By Harriet Marsden, The Week UK Published
-
America's natural gas boom
The Explainer The fossil fuel has replaced coal as the top source of electricity in the U.S. Is that good for the climate?
By The Week US Published
-
What can Cop28 really achieve?
Today's Big Question Climate summit in UAE proves controversial as UN warns world is falling short of global warming targets
By The Week UK Published