UK Offshore Wind Costs 4 Times Less Than Gas-Fired Thermal Generation
We got an email from Bill McKibben this week telling us about the latest UK renewable energy auction. When the smoke cleared and all the final bids were tallied, more than 7 gigawatts of new offshore wind energy will be added to the nation’s grid over the next 5 years at £44 per MWh. That is one quarter of what electricity from gas fired thermal generation today, according to Carbon Brief. In addition, 2.2 gigawatts (GW) of new solar capacity also won contracts at an average £55 per MWh and 0.9 GW of new onshore wind was bid in at £50 per MWh.
Offshore Wind Leads In UK Auction
Carbon Brief estimates the new renewable energy from this year’s auction will generate 42 terawatt-hours (TWh) of electricity per year, which will be enough to meet around 13% of current UK demand. Energy analysts estimate electricity from these new renewable sources will save consumers an estimated £1.5 billion per year by the end of this decade when all the new generating capacity comes online and reduce annual average utility bills by £58. The price of electricity in the UK has soared by nearly 50% recently as supplies of methane from Russia have been interrupted by Vladimir Putin’s war of aggression in Ukraine and are projected to rise even more as winter approaches.
Kingsmill Bond, a longtime City of London energy analyst now working for the Rocky Mountain Institute, tells Bill McKibben the numbers are the best possible news for a continent scared by Vladimir Putin: “We just do all this stuff and do it a bit faster, and we won’t need Russian gas. It is really not that hard. You don’t need to go cap in hand to foreign dictators to ask for more gas. Just change your own policy regime to bring these technologies online quicker.”
Easier said than done. Many of the UK leaders vying to replace Boris The Clown as prime minister are promising to transition away from the country’s embrace of clean renewable energy and restart fracking in the UK to unlock even more methane production. Clearly Johnson is not the only cuckoo clock in the UK government.
The UK government has committed to getting 95% of the country’s electricity from low carbon sources by 2030 and to fully decarbonize the grid by 2035. It is also aiming for “up to” 50 GW of offshore wind by 2030, a figure that would including “up to” 5 GW from floating offshore projects. Floating solar is designed for installations that are further offshore in deeper water where wind speeds are more constant and predictable.
The Nuclear Option
The UK is in the process of building a new nuclear power plant known as Hinkley C that will generate about 25 TWh of electricity per year when it starts operations in 2026 — 10 years after construction began. That electricity will cost €110 per MWh. The new renewable energy from this most recent auction will be online in less than 5 years and provide electricity at an average cost of about £41 per MWh. So let’s do the math, shall we? Half the cost in half the time versus nuclear. Which begs the question, why is Hinkley C being built at all?
The Takeaway
The market for methane gas has been turned upside down this year since Russia decided to shut off supplies to much of Europe. Reactionaries are screaming for more fracking, saying renewables are unreliable and take too long to bring online. Yet fracking for new wells can also take years before the gas gets to market. The transition to renewable energy should be moving faster because of the recent disruptions, not slower.
Thermal generation is a leading factor in making the Earth hotter and hotter. Advocating for more of it is extremely shortsighted bordering on suicidal. And yet, reactionaries everywhere are embracing thermal generation because if it was good enough for their grandparents, it’s good enough for them. The great leveling factor is price. It’s hard to cling to something when it cost 4 times as much as the alternative. In the final analysis, economics may be the only tool that can offset ideology. The US needs to take a page from the UK renewable energy playbook and the sooner the better.
Jesse Jenkins of Princeton University tells Bill McKibben if the US can make offshore wind as cheap as onshore the way the UK has done, ” it opens a huge resource potential in the Northeast and Mid-Atlantic states, close to demand centers, that would be an alternative to expanding transmission to reach onshore wind in the Midwest or solar in the Southeast, which is currently the lowest cost option” for places like his home state of New Jersey. The opportunity is there for the taking. Carpe Diem!
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