By Paul Homewood
Andrew Montford has highlighted yet another subsidy for offshore wind, which went under the radar last week. (Andrew’s reference to £27m/MW should read per GW, by the way):
https://x.com/aDissentient/status/1858488122490732761
When I saw Starmer’s announcement in the news, I assumed it was just another one-off £200m taxpayer bung for wind farm supplier chains.
As Andrew comments, however, it is actually another £200m a year to be handed out to offshore wind farms, who can prove they have a sustainable supply chain. This is defined as going beyond the CIB minimum standards:
Two criteria are used:
As Andrew points out, the whole thing appears to be very vague. In essence though, a wind farm can “invest” £50m per GW in a port or factory, and in return get back £27m every year for 15 years.
Furthermore there is no requirement that said wind farm will actually use these facilities.
Although the budget is £200m a year for the next CfD auction, it is highly likely to be repeated every year. In five years time, we could be paying out £1 billion a year.
There were reports a while ago that the wind industry were asking for back door top ups to subsidies, which they needed to be viable. It sounds like they have got what they were asking for!
At current prices, the latest CfD strike prices for offshore wind stand at around £82/MWh. This new bonus will add about £8/MWh to this.
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November 18, 2024 at 08:56AM
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