UK: DONG Can Go Below GBP 100/MWh by 2020

DONG Energy says that it can meet the UK Government’s target of GBP 100/MWh for offshore wind energy by 2020, and it can even reduce costs to achieve GBP 87/MWh, The Telegraph writes.

The company has forecasted this last year, after two reports were published by the Offshore Wind Cost Reduction Task Force, set up by the Government and led by the wind industry and The Crown Estate.

Benj Sykes, Head of DONG Energy’s UK Wind business, then said: “We are now seeing good progress in identifying ways to reduce the cost of offshore wind.”

Even though this amount seems unreachable to some, DONG accepts the challenge and sees it as a “very much realistic and achievable target”, The Telegraph cites Benj Sykes as saying.

The company’s plan is to take various actions to lessen the costs, such as building larger turbines (with rotors 200m in diameter) that have more power.

Nevertheless, if the contracts subsidising offshore wind in 2020 would cover a shorter duration than the lifetime of a wind farm, then they would still need to offer a price higher than GBP 87/MWh, Mr. Sykes said.

The target that the Government has set aims at lessening the price which consumers must pay for offshore wind energy through their bills. It requires cutting the cost down to GBP 100 per megawatt hour for offshore wind projects seeking financial investment approval in 2020.

[mappress]
Offshore WIND Staff, March 1, 2013; Image: DONG Energy