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Offshore wind costs tumbled: now cheaper than energy from Hinkley Point nuclear power plant

The tumbling cost of offshore wind power could mean that it turns out to be
25 per cent cheaper than energy from Hinkley Point nuclear plant when
subsidies are awarded to new projects this year, the industry regulator has
suggested.

Developers behind a series of proposed offshore wind farms are
vying to secure government contracts that will guarantee a price for the
electricity they generate for 15 years. Dermot Nolan, chief executive of
Ofgem, said he hoped the winning projects would emerge at a price of “£70
or less” per megawatt-hour (MWh).

That would compare with £92.50/MWh that
was last year awarded to Hinkley Point for a 35-year contract, fuelling
debate about the merits of the project and future nuclear plants. The
difference between the guaranteed price and wholesale price, currently
£43/MWh, will be subsidised by consumers through energy bills, with
payouts for Hinkley forecast to hit £30 billion.

Just a few years agooffshore wind was one of the most expensive technologies in the market. In
2014 the government awarded some projects a price of £150/MWh.
Technological advances, including bigger, more efficient turbines,
economies of scale in manufacturing and the introduction of a competitive
“reverse auction” process to award subsidies to the cheapest projects have
helped to bring costs down rapidly.

Times 30th June 2017

https://www.thetimes.co.uk/edition/business/offshore-wind-power-could-be-25-cheaper-than-hinkley-s-nuclear-qk77fqhd9

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July 1, 2017 - Posted by | renewable, UK

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