ScottishPower Renewables director to head Offshore Wind Cost Reduction Task Force

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23 August 2011, Nuclear, Solar, Wind

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The goal of the Offshore Wind Cost Reduction Task Force is to investigate means to reduce the levelized costs of offshore generation to GBP100 per megawatt hour by 2020, a reduction of a third compared to current costs. This will increase the potential contribution of offshore wind to the UK government's decarbonization targets.

Under the current scenario, the Department of Energy and Climate Change (DECC) expects to see 13 gigawatts (GW) of offshore wind power capacity in place by 2020, compared to the 1.5GW currently operational. The main driver behind the creation of the task force is the assumption that there is scope for a further 5GW of capacity if the targeted cost reductions can be achieved.

The task force was one of the key initiatives announced in the DECC's UK Renewable Energy Roadmap, released in July. It will receive input from the Crown Estate (which has responsibility for taking renewable energy proposals in UK waters through the planning and consent phases) and the industry, regarding the cost drivers of the offshore wind value chain and the priorities for taking action to reduce costs. Its recommendations will be jointly developed by industry and government, and will be delivered to ministers to feed into future renewable energy roadmaps.

Other initiatives in the current roadmap related to offshore wind include GBP30m of government support for cost reduction projects to 2015; supply chain development through the Offshore Wind Developers Forum; supporting manufacturing and testing facilities at strategic locations; support in resolving issues between offshore wind developments and the oil and gas industry; measures to provide greater financial certainty; and an Offshore Transmission Coordination Project to ensure that the networks are in place to support offshore generation.

The UK Renewable Energy Roadmap also outlines key actions in support of onshore wind, marine energy, biomass electricity, biomass heat, ground source and air source heat pumps, and renewable transport. Furthermore, it puts offshore wind into context as one part of the renewable agenda. Renewables themselves are "part of the decarbonization of the energy sector necessary by 2030, alongside nuclear, carbon capture and storage, and improvements in energy efficiency," according to the roadmap.

Offshore wind will act as a contingency source of power, should other sources of low carbon generation not deliver on the government's policy objectives. Ultimately, even if the task force is successful and the cost targets for offshore wind are met, offshore wind will run at a cost of roughly double the current UK wholesale electricity price. As more power is generated from these costlier renewable sources, the inevitable upward price pressure will be felt in the bills of UK electricity customers.

Source: Datamonitor

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