UK increases offshore wind support

By: Matthew White 23/07/2018 The UK Government

General Windfarms

A support package for UK industry to power millions more homes and businesses over the next decade was announced by Energy and Clean Growth Minister Claire Perry.

Offshore wind and, for the first time, remote island wind providers will be able to bid for contracts to power up to four million homes from Cornwall to the Shetland Isles. These clean electricity auctions will be held in 2019 and every two years from then on, signalling support worth up to £557 million for industry.

The auction will make the UK a beacon for inward investment and provide renewable energy businesses in the North East the certainty to invest and grow. This will encourage long term investment to help reduce the cost of energy.

Announcing the package on a visit to the Offshore Renewables Catapult in Newcastle, Energy and Clean Growth Minister Claire Perry will say: "The UK renewables sector is thriving, with more offshore wind capacity here than anywhere else in the world and 50% of electricity coming from low-carbon sources last year in what was our greenest year ever.

"For the last decade the offshore wind industry has been a great British success story: increasing productivity, raising earnings and improving lives in communities across the UK; and today the sector gets the certainty it needs to build on this success through the next 10 years."

The government has already met its ambition set out in the Clean Growth Strategy to produce 30% of its power from renewable sources by 2020/21 and this fresh support will see the UK continue supplying carbon free energy to the grid.

The announcement also supports supply chains from the south coast to north east. Companies such as Northumberland-based Osbit Ltd, which specialise in the supply of technical equipment and engineering services to offshore wind projects are now set to benefit from today’s boost to the renewables industry to secure their future.

Benj Sykes, Co-Chair of the Offshore Wind Industry Council and UK Country Manager at Ørsted said: "I welcome today’s announcement which is a strong vote of confidence in our industry. As well as cost-effectively reducing carbon emissions to meet our climate change targets, the offshore wind sector is powering the clean economy, bringing investment, skilled jobs and supply chain opportunities to businesses up and down the UK.

"We have proposed a transformative ambition to deliver at least 30GW by 2030, enough to meet more than a third of the country’s electricity needs, which in turn, together with the pipeline of regular auctions announced today, could increase exports five-fold, create thousands of skilled jobs and reduce electricity system costs."

Renewable UK welcomed the announcement on new auctions for renewable energy sources that are set to nearly double the UK's offshore wind capacity in the next decade.

The UK already has just over 7GW of operational offshore wind capacity – the largest amount of any country – and a further 7GW under construction or with contracts secured. The Government’s announcement of support for an additional 2GW of offshore wind per year in the 2020s could deliver up to 16GW of new capacity, which would generate approximately 20% of UK power.

RenewableUK’s Chief Executive, Hugh McNeal, said: “This is a ringing endorsement by Government of our world-leading offshore wind industry and its ability to deliver for UK businesses and British industry. Boosting our ambitions for offshore wind is win for consumers, as offshore wind is now one of the cheapest options for new power in the UK.

"Today’s announcement confirming the budget and timing of new auctions, sets us on the path do deliver the tens of billions of pounds of investment that will be needed to meet our ambition of at least 30GW by 2030. This is good news for domestic supply chain which can look forward to a pipeline of new offshore wind projects that will support tens of thousands of jobs across the UK.

"This is also an important boost for remote island wind, which like other renewables, is popular with the public and is a unique economic opportunity for island communities”

Clark MacFarlane, Managing Director of Siemens Gamesa Renewable Energy UK said: “This is a positive commitment from the Government, which will see offshore wind playing a bigger part in the UK energy mix in the next decade. A regular commitment to auctions and higher deployment is exactly what the supply chain needs to consolidate today's jobs and plan for the future ones.”

Matthew Wright, UK Managing Director of Ørsted said: “We’re really excited by this positive announcement for offshore wind in the UK. The UK has gained its status as the global leader in offshore wind by industry and Government working together to give businesses the confidence to invest in projects, which have consistently been delivered on time and on budget. Through Contracts for Difference, the industry has slashed its costs, led by projects like Hornsea Project Two, which recently won an auction at the lowest ever price for offshore wind in the UK, halving the auction prices seen just two and a half years earlier."

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