UK offshore wind power costs have plummeted by almost a third in four years, putting the technology on course to soon be level with the cost of conventional power generation, a report by the UK’s Offshore Renewable Energy Catapult (ORE) has revealed.
The study suggests the offshore wind sector has beaten the UK government’s target of driving down generation costs below £100 per megawatt hour a full four years ahead of schedule, with new projects reaching an average levelised cost of £97/MWh during 2015/16, according to yesterday’s report.
In yet another milestone for the UK’s burgeoning offshore wind industry, costs have fallen by 32 per cent on average since the government’s target was set in 2012. Average costs stood at £142/MWh back in 2010/11.
The industry is now focused on further cost reductions, growth and job creation, the third annual Cost Reduction Monitoring Report said.
Energy minister Jesse Norman said the UK’s leadership in offshore wind made it an attractive destination for renewable energy investment.
“This growing industry will be an important part of the government’s new industrial strategy, and will be underpinned by £730m of annual support for renewable energy over the course of this parliament,” said Norman. “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.”
Co-chair of the Offshore Wind Industry Council (OWIC), Benj Sykes, said the sector was cutting costs much faster than predicted while creating jobs and stimulating investment worldwide. But he added that the offshore wind story was “just beginning”.
“We remain committed to delivering further significant cost reduction, while working in partnership with government to put in place a sector deal and build a sustainable industry that will benefit the UK for decades to come,” he said. “Our industry’s goal is to be cost competitive with other generation sources, and this new data shows that ambition is realistic and that we are well on the way to achieving it.”
Friends of the Earth renewable energy campaigner Alasdair Cameron welcomed the news and urged the government to put offshore wind, as well as other clean technologies such as battery storage and electric vehicles at the heart of its new industrial strategy published earlier this week.
“Renewables are increasingly recognised as being affordable and reliable, and those countries which lead the transition to a low-carbon economy will be well placed to thrive in the 21st century,” said Cameron. “The government must fully embrace the clean energy revolution and ensure sufficient investment in the UK’s huge job-creating renewable power potential – including onshore wind and solar, which are now among the cheapest energy sources of any kind.”