Carbon Trust calls for urgent debate on siting of offshore wind fams to help slash costs 

Relaxation of the constraints that dictate where offshore wind farms can be built could cut £16bn from the overall cost of developing offshore wind, according to a new report launched today by the Carbon Trust.

Applying all the current constraints would require the UK’s next round of offshore wind farms to be built at great expense 70 miles from the shore and in deep waters. Allowing wind farms to be built nearer to the shore and in shallower waters is the key cost-saving measure that will enable 29 GW of offshore wind farms to be built by 2020¹. This in turn will help the UK meet renewable energy targets, cut carbon emissions by 14%, create 70,000 new jobs and bolster energy security.

Offshore wind power can play a leading role in meeting the UK’s target to generate 15% of energy from renewable sources by 2020. However, without urgent action from government to reduce the costs and risks and increase returns to developers, the UK will only build a quarter of the 29GW of offshore wind farms needed to reach the 2020 target.

Erecting turbines in potentially restricted waters would alone reduce costs by more than 20%. Other recommendations in the report Offshore Wind: big challenge, big opportunity, based on analysis by The Boston Consulting Group, include removing grid and planning regulatory barriers, increasing public R&D funding and modifying the current incentive mechanism. Together, the recommendations found up to 40% cost savings could be made, slashing £30bn from the total cost of development which in turn could make offshore wind power competitive with conventional generation before 2020.

Tom Delay, chief executive of the Carbon Trust said:
“If we are to meet our 2020 renewable targets we need a dash for wind on a comparable scale to the dash for gas of the 1990s.  Slashing the costs of offshore wind must now be a priority for UK energy policy. The Government must use the upcoming consultation on this important issue to unlock the most economically attractive sites for development.  This would dramatically reduce the cost of development - essential if we are going to meet our 2020 renewable targets and deliver significant reductions in our carbon emissions.

“We’ve laid out a series of measures to ensure the offshore wind industry delivers at scale over the next twelve years. What’s more, the benefits of fast-tracking the commercialisation of this new industry are far-reaching in terms of employment, energy security and the economy as a whole. With the right innovation and manufacturing strategy, the UK could see up to 70,000 jobs created and up to £8bn in revenues generated every year.”

Energy and Climate Change Minister Mike O’Brien said:
“This Carbon Trust report is important in highlighting the potential savings as we aim to boost offshore wind. The seas around Britain have great potential for clean green energy generation – helping us secure our future energy supplies and combating climate change. There is also the chance to create tens of thousands of new green collar jobs.

“The issues of fairness and cost-effectiveness, along with impacts on the environment and on other users of the sea will be considered carefully in the lead up to our renewable energy strategy to be published next Spring.”

Rob Hastings, Director of Marine Estate, The Crown Estate, said:
"The Carbon Trust has clearly highlighted the vast potential for sustainable power from UK offshore wind alongside the challenges of delivery.  We support the report's dual priorities to reduce project outturn costs and to align the UK's planning and grid regulatory regimes with the country's renewable energy targets for 2020.  We are confident that opportunities to find solutions to these challenges and to deliver the potential of offshore wind are presented by the Round 3 program which seeks to maximise installed capacity through development and deployment over a duration which matches the most suitable locations with the most appropriate technology."

Duncan Ayling, Head of Offshore at the British Wind Energy Association, said:
“Offshore energy sources and wind in particular, can deliver the lion’s share of the UK’s 2020 renewable energy targets. The Carbon Trust’s report makes a clear case for the urgent need to get the support and regulation right. The outcome could be a revolution in the way electricity is produced and distributed in this country, with potentially 25% of UK electricity demand being powered by offshore wind.”

John Sauven, Executive Director of Greenpeace, said:
"We need to promote a massive redirection of investment away from the speculation that has caused the bursting financial and housing bubbles and into new green industries and job-creating programmes that will help us tackle climate change. Offshore wind power could be a really huge business opportunity for Britain if the government now seizes the initiative."

A copy of the report can be accessed here.