Regulatory framework and markets are key

Huub den Rooijen, Head of Offshore Wind, this week addressed All Energy in Aberdeen, the UK's largest renewables event, to outline the challenges faced by the industry and the opportunities presented to the UK.

23 May 2012

Thanet Offshore Wind Farm

Speaking alongside Alex Salmond, First Minister of Scotland, and Charles Hendry, the UK Energy Minister, Huub emphasised that an accelerated consenting process and a scale opportunity in excess of 18 GW by 2020 will be essential to creating the investor and developer confidence required to deliver both the cost reductions and the capital required.

He hailed the offshore wind industry as a success story, having last year generated 1.5 per cent of all electricity consumed in the UK, which will rise to three per cent when current construction works complete.

Recent developments in the sector include another 12.9 GW of 'Agreements for Lease' having been signed up, bringing the total to 23.1 GW. Also this year the first Round 3 and Scottish Territorial Waters projects will apply for consents, presenting interesting challenges to the planning system in ensuring the applications can be processed in the timeframe that these developers require to make investments and meet government aspirations.

He said: "The UK's natural resources in wind and ocean energy, its great industrial infrastructure, and the demands of its electricity market make it one of the best places on the planet to develop offshore renewables. We're working hard to create the structures and provide support to developers to lower the risks of investment by helping to bring offshore renewable resources to market, together with other areas of low-carbon energy, such as the development of commercial-scale CCS and natural gas storage. We take a balanced approach to meeting the following three challenges:

"Tackling the conundrum of lowering costs. Next month we'll present the results of a study that we've carried out with industry. Although not yet complete, it suggests that the gauntlet of 100 pounds per MWh thrown down by the government is within reach, provided the industry has sufficient scale.

"We are addressing sector-wide issues to ensure true sustainability of offshore wind. That means understanding environmental impacts, as well as the impacts that these projects have on local communities. We are working with developers and industry, for example in conducting surveys, public consultations, coordinating grid connections, but also in co-organising supply chain events where companies get the chance to learn about the opportunities for their own business.

"The scale of the enterprise. We are working to generate investment options to reach a total of 25GW of offshore wind early in the 2020s across the UK. Projects currently underway could comfortably reach that number and we are working with industry and government to understand how our current programmes can be optimised.

"At The Crown Estate we have and will continue to work with the industry to help unlock the economic potential of the nation's offshore energy resources, in a way that provides benefits to communities and respects the environment."