Zero New Offshore Wind Farms Commissioned: A Missed Green Opportunity for Britain
By Alex Brummer for the Daily Mail
Published: 00:43 BST, 9 September 2023 | Updated: 00:49 BST, 9 September 2023
The Government’s ambitious goal of achieving a net-zero carbon footprint by 2050 has suffered a significant setback. In a crucial auction this week, no company came forward to bid for a new offshore wind farm, despite successful deals being struck for solar, tidal, and onshore wind projects.
Why this lack of investment? In recent years, a combination of factors, including the COVID-19 pandemic, Russia’s war in Ukraine, inflation in goods and energy prices, and the exorbitant interest rates, has dramatically altered the economics of offshore wind.
Leading offshore wind investors in Britain had been warning the Government for months about the escalating costs of manufacturing and installing turbines. As the CEO of Scottish Power succinctly put it, “The economics simply did not stand up.”
In fact, the writing has been on the wall for offshore wind since July when Swedish group Vattenfall, a major developer of offshore wind power, canceled its project off the coast of Norfolk due to skyrocketing costs of materials, labor, and equipment.
Some have argued that the Government should have manipulated the auction to ensure it was financially viable for investors, possibly through subsidies. However, the reality is not that simple. With the UK’s public finances strained by increasing costs for healthcare and welfare, no government could afford to be seen providing large subsidies to foreign-owned offshore wind developers at the expense of hard-pressed UK taxpayers.
It’s undoubtedly been a challenging week for the Government’s green strategy. However, we must keep things in perspective. Onshore wind farms are controversial and face opposition from local communities. On the other hand, offshore wind generation has been a tremendous success for Britain, allowing the country to generate approximately 25% of its electricity from this renewable source.
No other country, except possibly China, has embraced sea-based turbines quite like Britain has. Over the past decade, as more offshore wind farms were built, the cost of electricity generated from them plummeted by 75%.
In response to lobbying, Rishi Sunak has eased planning rules to promote the construction of onshore wind farms. While they may be cheaper to build, they are less efficient and productive compared to their offshore counterparts, and many consider them an eyesore on the national landscape.
Once again, the machinery of government has misfired. A significant opportunity to accelerate green energy production has been lost. However, it should not be beyond the capabilities of regulatory bodies like Ofgem, the Department of Energy, and the Treasury to devise a better approach and unleash the development of more offshore wind turbines.
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