Current energy consumptionThe UK has an ambitious target of reducing greenhouse gas emissions by 57% relative to 1990 levels by 2030, and by 80% by 2050. Offshore wind currently generates 5% of the UK’s electricity and this is expected to double by 2020 (The Crown Estate, 2018). In 2017, more than 50% of the UK’s electricity was generated by low carbon sources (Imperial College London, 2018) and the total installed capacity has doubled since 2012 (Figure 1). Simultaneously, the proportion of energy we receive from coal and fuel oil continues to decrease (Figure 2). Renewable energy now provides around 30% of UK power. Annually, wind provides about 15% of the UK’s electricity, however this can rise to as much as 25%. Although gas currently remains our biggest source of power, an increase in the number of solar and wind installations is steadily starting to decarbonise the UK's energy consumption.
Figure 1. UK installed capacity from renewable sources (Lake Street Consulting, 2018)
Figure 2. Total power capacity generated in the EU between 2005-2017 (WindEurope, 2018)
Offshore wind capacityIn 2018 the UK registered the largest annual increase of wind energy electricity demand in Europe, from 13.5% to 18% (WindEurope, 2019), with 36% of the world’s offshore wind capacity being controlled by the UK. Offshore wind currently powers the equivalent of 4.5 million homes every year and by 2020 it will generate more than 10% of our electricity needs. By 2030, the aim of the industry is to deliver 30GW, or one third of the country’s total electricity needs, powering homes, businesses, electric vehicles and heating.
The cost of offshore windThe cost of new offshore wind has dropped by 50% between 2015 and 2017 (BEIS, 2019), making offshore wind the most affordable form of large scale, clean energy; cheaper than new gas and nuclear power. Purely from an economical perspective, we need to minimise non-renewable electric power generation, regardless of any social or environmental considerations.
We are entering a time of change in how electricity is delivered to the consumer as we move towards smart grids and innovative renewable and sustainable electricity storage technologies. The offshore wind sector will invest up to £250m in building a stronger UK supply chain (BEIS, 2019). This promises more than just a revolution in power generation but also an opportunity to create thousands of highly skilled ‘green collar’ jobs in a wide range of fields, all along the supply chain, with nearly three times more people than today employed in the sector by 2030.
Offshore wind prices fell to record lows in the latest Contracts-for-Difference auction. Contracts were secured at an average price of £62/MWh for projects commissioning in the early 2020s, a 60% reduction on the price of projects commissioning today. Offshore wind exemplifies how clear goals, an ambitious strategy and well designed mechanisms, can encourage and enable the market to reduce cost and help to build wider economic co-benefits.
BEIS (2019) Industrial Strategy Offshore Wind Sector Deal. Available at: https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/786278/BEIS_Offshore_Wind_Single_Pages_web_optimised.pdf
Hillsdon, M. (2019). Offshore wind is on the rise, but what does the future hold?. [online] Raconteur. Available at:
Lake Street Consulting (2018) http://www.lakestreetconsulting.co.uk/westernlink/