EDITOR’S COMMENT: Boris’s plan is bonkers and full of hot air. What happens when there’s no wind…?
Boris Johnson announced at his party conference today the Government’s target for a four-fold increase in the amount of electricity generated by wind turbines off UK shores by 2030.
“We believe that in 10 years time offshore wind will be powering every home in the country,” the Prime Minister said, predicting that everyone’s kettles, washing machines and electric cars would be powered “without guilt from the breezes that blow around these islands.”
The target had been outlined in the Conservative manifesto for the 2019 election. But its becoming policy nonetheless marks a significant and welcome shift, as the government tries to chart a path to its legally binding target of cutting carbon emissions by 2050.
Making the leap from the current 10GW of offshore wind power to 40GW by 2030 will cost about £50bn in capital investment and require wind turbines to be built at roughly double the current rate – about 260 a year, Aurora Energy Research estimates.
There is no shortage of developers who want to build offshore wind. But there are questions over whether the current subsidy regime is the best way to get them to deliver the next 30GW.
First, the system is expensive. Aurora Energy Research estimates that, at a guaranteed price of £40 MwH, it would cost about £2.6bn per year to deliver the extra capacity – almost five times the £557m budgeted in 2019.
Second, the auctions are held every two years, likely too slow for the increase required. SSE says the target will be “impossible” to achieve without annual auctions from 2025.
Third, there is an unhelpful paradox at work. Renewables push down the wholesale price of electricity, increasing the difference against the guaranteed price – for which bill-payers are on the hook – and lowering returns for developers exposed to wholesale prices.