Offshore wind design

Environment – increasingly affordable renewables

Is renewable energy without subsidies really affordable? The long-term answer is unquestionably yes.

( Text content written by Twenty6 for LIC Energy )

There is no fundamental flaw in the non-fossil, non-nuclear energy market that could prevent specific renewables from becoming both commercial and sustainable… once they are fully-fledged.

In fact, the UK offshore wind industry is already years ahead of its cost reduction targets, and well en-route to standing on its own financial feet.

A smaller difference makes all the difference

The renewable energy Contract for Difference (CFD) is an electricity market reform mechanism whereby government pays low-carbon electricity generators the difference between a ‘strike’ price, that reflects low-carbon technology investment costs, and the wholesale electricity price.

The aim is to protect both consumers and generators from volatile wholesale prices and high support costs.

Recent positive news from the UK offshore wind sector is almost certain to have a significant effect on the outcome of a series of green energy CFD auctions worth 730 million planned over the life of the current Parliament. Other competitors could be marginalised.

Tumbling UK offshore wind costs

An early 2017 report from the Offshore Wind Programme Board (OWPB), which manages the UK seabed for The Crown Estate, showed sector costs falling by 32% from 142/MWh in 2012 to 97/MWh in 2016.

This was due to technical advances, larger turbines – 7MW and 8MW turbines are now standard – more competition and lower costs of capital. It also breached the Government’s 2020 target of 100/MWh four years early, with costs expected to fall by a further 24% to 30% by 2030.

Pushing uncertain nuclear out of the picture

UK offshore wind is now a strong competitor to a new generation of nuclear power plants. The Government’s contract to French energy company, EDF, for building the Hinkley Point C reactor was priced at 92.50/MWh, even though the future costs are far from certain, and the duration of the contract is significantly longer at 35 years.

Meanwhile, Reuters notes that the UK has invested more than 9.5 billion in offshore wind since 2010.

Onshore neglected but not forgotten

Onshore wind lacks the same advantages of steady metocean winds and large turbine options. However, with no sub-sea cables to bring power ashore, no fierce waves and tides, and a far more benign corrosion environment, its installation costs are lower.

The problem facing UK onshore wind is false barriers erected by ministers who believe turbines are unpopular with local communities. The Government wants blade tip-heights to be no greater than 125m. In Sweden, many new turbines now stand at 170m to 200m; the German average is 165m.

Large modern turbines are more efficient. They feed smart data from sensors to central computer systems, have better gearboxes, or no gearboxes, plus hi-tech blades that produce more power but with less noise.

We are losing these advantages.

No renewables cost barriers

The conclusion has to be that, for wind energy in particular, no renewable energy cost fault lines exist that the industry can’t overcome.

Recent figures also show that the Government’s interpretation of local opposition is wrong.

According to the Government’s ‘Energy and Climate Change Attitude Tracker, Wave 21’, released in May, 73% of the UK public now positively support onshore wind – an all-time high.

Opposition over the last five years has hovered between 8% and 9%.