Off­shore wind power cheaper than new nuclear

The Malta Business Weekly - - FRONT PAGE -

En­ergy from off­shore wind in the UK will be cheaper than elec­tric­ity from new nuclear power for the first time.

The cost of sub­si­dies for new off­shore wind farms has halved since the last 2015 auc­tion for clean en­ergy projects

Two firms said they were will­ing to build off­shore wind farms for a guar­an­teed price of £57.50 per megawatt hour for 2022-23.

This com­pares with the new Hink­ley Point C nuclear plant se­cur­ing sub­si­dies of £92.50 per megawatt hour.

Nuclear firms said the UK still needed a mix of low-car­bon en­ergy, es­pe­cially for when wind power was not avail­able.

The fig­ures for off­shore wind, from the De­part­ment for Busi­ness, En­ergy and In­dus­trial Strat­egy, were re­vealed as the re­sult of an auc­tion for sub­si­dies, in which the low­est bid­der wins.

In the auc­tion in 2015, off­shore wind farm projects won sub­si­dies be­tween £114 and £120 per megawatt hour.

Emma Pinch­beck, from the wind en­ergy trade body Re­new­able UK, told the BBC the lat­est fig­ures were "truly as­ton­ish­ing".

"We still think nuclear can be part of the mix - but our in­dus­try has shown how to drive costs down, and now they need to do the same."

Big­ger tur­bines, higher volt­age ca­bles and lower cost foun­da­tions, as well as growth in the UK sup­ply chain and the down­turn in the oil and gas in­dus­try have all con­trib­uted to fall­ing prices.

The new­est 8 megawatt off­shore tur­bines stand al­most 200 me­tres high, taller than Lon­don's Gherkin build­ing. But Ms Pinch­beck said the tur­bines would dou­ble in size in the 2020s.

How­ever, the nuclear in­dus­try said that be­cause wind power is in­ter­mit­tent, nuclear en­ergy would still be needed.

Tom Greatrex, chief ex­ec­u­tive of the Nuclear In­dus­try As­so­ci­a­tion, said: "It doesn't mat­ter how low the price of off­shore wind is. On last year's fig­ures it only pro­duced elec­tric­ity for 36% of the time."

EDF, which is build­ing the Hink­ley Point C nuclear plant, said the UK still needed a "di­verse, well-bal­anced" mix of low-car­bon en­ergy.

"New nuclear re­mains com­pet­i­tive for con­sumers who face ex­tra costs in pro­vid­ing back-up power when the wind doesn't blow or the sun doesn't shine," the French firm said.

"There are also costs of deal­ing with ex­cess elec­tric­ity when there is too much wind or sun."

EDF added that en­ergy from new nuclear plants would be­come cheaper as the mar­ket ma­tures, as has hap­pened with off­shore wind.

Eyes will be raised at this sug­ges­tion, as nuclear power has al­ready re­ceived sub­si­dies since the 1950s. But stor­age of sur­plus en­ergy from off­shore wind is still a chal­lenge.

On­shore wind power and so­lar en­ergy are al­ready both cost-com­pet­i­tive with gas in some places in the UK.

And the price of en­ergy sub­si­dies for off­shore wind has now halved in less than three years.

En­ergy an­a­lysts said UK govern­ment pol­icy helped to lower the costs by nur­tur­ing the fledg­ling in­dus­try, then in­cen­tivis­ing it to ex­pand - and then de­mand­ing firms should bid in auc­tion for their sub­si­dies.

Min­is­ter for En­ergy and In­dus­try Richard Har­ring­ton said: "We've placed clean growth at the heart of the In­dus­trial Strat­egy to un­lock op­por­tu­ni­ties across the coun­try, while cut­ting car­bon emis­sions.

"The off­shore wind sec­tor alone will in­vest £17.5bn in the UK up to 2021 and thou­sands of new jobs in Bri­tish busi­nesses will be cre­ated by the projects an­nounced to­day."

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