To make the Prime Minister’s ambitious targets on offshore wind a reality, we need new laws now.
From pretty much a standing start in 2010, the UK set the target of generating 10GW of electricity offshore by 2030, which seemed a challenge.
Thanks to an inspired set of market signals from the Coalition Government through the system of Contracts for Difference (CfD) that initial target has already been reached: in 10 years the UK has developed the world’s largest offshore wind generating capacity.
With scale has come a huge reduction in price; with the auction price of offshore wind reduced by around two-thirds between 2015 and 2019.
The Prime Minister has now set the target of delivering not 10GW but 40GW of offshore generation by 2030. To put that task into perspective, the then minister for energy, Kwasi Kwarteng, acknowledged recently that this, “…equates to installing one turbine each weekday throughout the whole of the 2020s.”
It’s a big ask. So, how are we going to do it?
Not in the way that we have got to where we are! It’s true that one of the reasons we have been able to expand so quickly has been the regulatory framework that the Government set up in 2010, making each windfarm responsible for its own connection to the national transmission network. Whilst this has meant multiple individual cable corridors being dug across our countryside, it did allow the industry to get up and a running without having to wait for a large offshore infrastructure to be designed and constructed.
The Prime Minister is right to promise the country that we will deliver 40GW of renewable electricity from offshore wind by 2030. We need the laws right now to make this a reality.
Having commissioned a strategic review this summer from OFGEM and NG/ESO Kwasi Kwarteng has accepted that “…the argument for some form of offshore network system has been won”. The issue now is one of timing: quick enough to reap the rewards of an integrated system, but without slowing up delivery overall.
The integrated system needs to be in place for most of the 30GW of new wind generation to benefit from it. And benefit they will. The NG/ESO cost benefit analysis suggests that the installation of an integrated system now, will save the industry both CAPEX and OPEX of some £6.4Bn – an 18% saving overall - by 2050.
And that is on top of the halving of environmental and societal impacts when compared with the current system. In fact, the analysis could not find a single indicator that did not support the early development of an integrated system.
All the industry needs is a decisive market signal from the Government to unlock this wave of infrastructure development. The legislative framework needs to be tweaked to provide this signal as soon as possible – in an Energy Bill in the next Queen’s Speech. If we miss this timing, we will end up creating the connection infrastructure after most of the planned growth has already been connected!
The Prime Minister is right to promise the country that we will deliver 40GW of renewable electricity from offshore wind by 2030 – enough to power every home in the UK. We need the laws right now to make this a reality.
Listen to Jerome, along with Alan Brown MP and Andrew Griffith MP, on the latest edpisode of the Engineering a Better World podcast series.
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