UK Government to rethink offshore wind prices to attract investment
The UK Government is reportedly set to significantly boost the price to £70-£75 per megawatt hour in response to the recent failure of its Contracts for Difference (CfD) auction round.
The last auction, which offered £44 per megawatt hour, attracted no bidders, raising concerns about meeting net zero targets.
The rise to £70-£75 per megawatt hour addresses that the previous price was not enough to cover rising construction costs, with industry leaders reportedly stating the need for a figure closer to £70 was needed for new projects to be financially viable.
According to Sky News, the announcement of the price adjustment is likely to come this week.
Sam Richards, Founder and Campaign Director for campaign group Britain Remade, said: “Even with this increased price offshore wind is still much cheaper than gas, meaning millions of households up and down the country can benefit from one of the cheapest sources of energy.
“Thanks to the CfD system the offshore industry has been able to drive down costs. But offshore wind could be made even cheaper by slashing red tape, tackling bureaucracy and reforming our outdated planning system which means it can take up to 13 years for a new offshore wind farm to be completed despite constructing the actual turbines only taking 2 years.
“Hopefully this news will restore confidence in the offshore wind sector and Britain can once again secure billions in investment and see vital jobs created.”
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