12 September, 2017
The UK's latest competitive auction saw offshore wind prices tumble to record lows of as little as £57.50 per MWh, a 47% decrease on past offshore wind prices, and dipping well below the price guaranteed to the Hinkley Point nuclear power plant.
"We hope to see all renewable technologies getting the chance to bid in future auction rounds and to demonstrate just how cheap they can be". Compare £57.50 with the subsidy secured by new nuclear plant Hinkley Point C, which is £92.50, or around $122, per megawatt-hour.
Ministers said the subsidies, paid for by consumers on energy bills, would bring forward enough clean power for 3.6m homes and create thousands of jobs.
Caroline Lucas, the party's co-leader, said: "This massive price drop for offshore wind is a huge boost for the renewables industry and should be the nail in the coffin for new nuclear".
Energy from offshore wind farms will be less expensive than power from a new nuclear project for the first time, based on subsidy figures via the Department of Business, Energy, and Industrial Strategy after an auction.
"We were pleasantly surprised by the low price bids in the latest auction", Ware told AFP, describing it a "vindication" of government policy. At the time the big news was the impressive strike prices for two offshore wind farms to be delivered in 2022/23 - £57.50 MW/h for DONG Energy's 1,386 MW Hornsea 2 off the coast of Yorkshire, and EDPR's 950 MW Moray off the northeast coast of Scotland.
Earlier this year, energy research firm Westwood Global Energy Group predicted that global offshore wind energy capacity will increase fivefold between 2017 and 2025.
Lawrence Slade, chief executive of energy industry body Energy UK, called on ministers to build on the UK's lead in renewables.
The BBC listed larger turbines, foundations that cost less, and higher voltage cables as components that have helped reduce prices for offshore wind, along with United Kingdom supply chain growth and the oil and gas industry downturn.
"Today's results mean that both onshore and offshore wind are cheaper than gas and nuclear", said RenewableUK's Chief Executive Hugh McNeal.
The price of building offshore windfarms has fallen by almost a third since 2012 as the technology matured, and developers believe that a new generation of even bigger turbines mean they can achieve further cost reductions in coming years.
"The government must now set out in its Clean Growth Plan a clear plan for cutting emissions further from the UK's energy system, and provide certainty to investors over the timing for further auctions rounds for all technologies".