A session in the house of lords this afternoon on the economics of UK energy policy saw the Chief Executive of RenewableUK, Hugh McNeal, giving evidence.
Mr McNeal told the committee that onshore wind offers significant benefits for consumers, stating: “We are competitive – nothing else can be built at scale that would generate electricity more cheaply. My members who develop and build large onshore wind plants do not want subsidy – we just want a chance to compete and demonstrate how cheap we can be – a route to market. Predicting the outcome of a competitive process is a risky business, but if you were to run a Contracts for Difference auction process, I think you would be looking at a clearing price for onshore wind in the £50s and a levelised cost of energy possibly in the £40s.”
I would not be surprised if we saw the next offshore wind auction clear at or below the Hinkley level
He also highlighted the offshore wind industry’s relentless focus on cost reduction, noting: “We are making great progress and I would not be surprised if we saw the next offshore wind auction clear at or below the Hinkley level, and offshore wind projects being cost competitive with gas by the middle of the next decade.”