Driving down the cost of offshore wind
11 Jun 2014 10:33 AM
More winds farms have
been brought in to a competitive system to drive down the costs of offshore
wind.
More winds farms have been
brought in to a competitive system to drive down the costs of offshore
wind.
The offshore transmission regime
means that Ofgem can find the most cost-effective investment in the connecting
cables and infrastructure for offshore wind power, saving consumers between
£200 and £400 million since 2011, according to estimates by
independent experts.
Energy Minister Michael Fallon
said:
“Driving down the costs of
offshore wind is a priority to encourage investment in the sector, and will
help keep the UK’s place as the best country in the world for offshore
wind.”
Investors are now able to bid
competitively to maintain and run the high voltage cables and infrastructure
between offshore wind farms and the grid, making offshore wind less costly to
develop. It also means that projects can move ahead at a faster pace and
electricity can be brought onto the grid more quickly. Fifteen wind farms have
so far been covered by the regime, which will produce over 4 GW, enough to
power nearly 2.8 million homes.
The regime has also been
expanded to give wind farm developers the option of asking a winning bidder to
construct the transmission assets, as well as maintaining and running them.
This means developers will not have to tie up their capital in connecting
infrastructure and can plough their funds into constructing more offshore wind
farms.
£1.4 billion of
infrastructure investment has already been delivered and licensed, with another
£1.5 billion in the tender process and billions more in the pipeline. The
regime has tapped into new sources of investment, including pension
funds