Weekly Intelligence Brief
UK offshore winds can provide an extra 25GW
2 July 2009
Energy Minister Lord Hunt has announced that an extra 25GW of offshore wind energy could be accommodated around the UK’s shores, in addition to the 8GW already built or planned.
The findings formed part of the government’s Strategic Environmental Assessment (SEA) of UK waters, and will enable the Crown Estate to proceed with the third round of leasing for offshore wind farms.
The Crown Estate launched Round 3 of offshore wind in June last year. This decision means they can proceed with negotiations and award development rights to the market. Any proposals for developments will be assessed by the relevant authorities to ensure they are located in appropriate places.
The announcement accompanies the launch of a new offshore cabling licensing regime, and the news that the UK will be joining the newly-formed International Renewable Energy Agency.
The new licensing regime for the cables to connect offshore wind farms to the mainland has also started. The competitive tender process, run by Ofgem, has the potential to save generators £1bn by getting the best deal, stated the Department of Energy and Climate Change (DECC). It will also attract new entrants with transmission expertise and, offer longer term stable investment opportunity.
Offshore transmission regime tender process
Following a four year consultation, companies will now be able to bid to design, finance, construct and maintain the transmission assets. For existing projects they will bid to own and maintain the assets.
The National Grid’s function as system operator has now been extended to offshore and will play a key role in the development of the new regime. It will now be responsible for overseeing the connections to ensure that all generators that want to connect to the onshore grid can. This regime is designed to be flexible to allow generators to choose when and how their projects are tendered.
In a separate report, BWEA said Britain was on course to have a cumulative installed offshore wind capacity of up to 9 GW by 2015, which meant wind would overtake the country's nuclear capacity within the next 4-5 years.
