Power cost from offshore wind farms falls by third in five years, energy report reveals

THE COST of power from offshore wind farms has fallen by a third in five years, a report has shown.

Energy prices for offshore wind have fallen 32 per cent since 2012, and are now below the target agreed by Government and industry of £100 per megawatt hour (MWh), four years ahead of 2020 date set to achieve the goal.

The industry said it was “well on the way” to being cost-competitive with other sources of power generation.

Schemes making final investment decisions in 2015/2016 were doing so with a cost of energy of £97/MWh, compared with £142/ MWh five years earlier, the third annual cost reduction monitoring framework (CRMF) report shows.

The fall in price is down to the adoption of larger turbines, increased competition and lower cost of capital, according to the report from the Offshore Renewable Energy (ORE) Catapult on behalf of the Offshore Wind Programme Board (OWPB).

Installing fewer, larger turbines reduces costs, with the newest 8MW units providing enough electricity to meet a household’s power needs for more than a day from just one rotation of the blades, the industry says.

UK Energy Minister Jesse Norman said: “The UK’s leadership in offshore wind clearly demonstrates that it is an attractive destination for renewable energy investment.”

He said the industry would be an important part of the Government’s new industrial strategy outlined on Monday, and would be underpinned by £730m of annual support for renewables over the course of the parliament.

“Thanks to the efforts of developers, the UK’s vigorous supply chain and support from Government, renewables costs are continuing to fall.

“Offshore wind will continue to help the UK to meet its climate change commitments, as well as delivering jobs and growth across the country,” he said. Co-chairman of the Offshore Wind Industry Council (OWIC) Benj Sykes said offshore wind was a “big success story at the very heart of the UK’s industrial strategy”.

The Yorkshire region is home to a number of planned windfarms including the world’s largest, 55 miles off the coast, and Dogger Bank off Teesside.