Renewables Price – Green light for more big offshore farms 

Three Offshore Wind Projects Secure Contracts for Difference as Strike Prices Go Down

Offshore Wind biz ‘The UK government has awarded three offshore wind projects with Contracts for Difference (CfD) in the second round of auctions with strike prices going as low as GBP 57.50/MWh for projects scheduled for commissioning in 2022/23. The three projects to receive the CfDs are the 860MW Triton Knoll offshore wind farm off England, the 1,386MW Hornsea Project Two off England, and the 950MW Moray Offshore Windfarm (East) off Scotland, according to the results published by the Department for Business, Energy & Industrial Strategy (BEIS). The Triton Knoll project is scheduled for commissioning in 2021/22 and will be delivered at a strike price of GBP 74.75/MWh.

The Hornsea Project Two and the Moray Offshore Windfarm (East) are scheduled for commissioning in 2022/23 and will be delivered at a strike price of GBP 57.50/MWh, 50% lower compared to the results of the first auction held in 2015. All three projects are to be built in three phases, with the first phases expected to be commissioned in 2021 and 2022, respectively.’ Click here to read more 

Carbon Brief Analysis The UK government awarded contracts worth £176m to 11 low-carbon electricity schemes, with offshore wind the big winner. These projects will generate nearly 3% of UK electricity demand.

Two offshore wind schemes won contracts at record-lows of £57.50 per megawatt hour (MWh). This puts them among the cheapest new sources of electricity generation in the UK, joining onshore wind and solar, with all three cheaper than new gas, according to government projections.

The offshore wind schemes are also close to being subsidy-free: the Department for Business, Energy and Industrial Strategy (BEIS) expects wholesale power prices to average £53/MWh in the period from 2023 to 2035, covering the bulk of their 15-year contract period.

The auction results shift the conversation, from renewables being expensive, towards how cheap, variable zero-carbon power can be integrated into the grid, while maintaining sufficient supplies of power throughout the year.  Click here to read more

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