On-shore windfarms are now the cheapest way to produce electricity

By Energy Company Numbers on October 15, 2015 in Help and advice

Windfarms have taken a buffeting over the years. There have been protests about their vast size, as they stud the landscape in some of the most beautiful parts of the country. Objections have also been raised on economic grounds – lack of cost-effectiveness, and low productivity. But it seems like we are finally making peace with the wind turbine, not least because they have now been proven to be the cheapest way to produce electricity, putting them well ahead of coal and gas-fired plants. Bloomberg New Energy Finance (BNEF) performed a ‘detailed analysis by technology and region’, and produced a report on the new findings.

Lower Costs, Higher Yields

Seb Henbest, Head of Europe, Middle East and Africa at Bloomberg New Energy Finance, has put the improved efficiency down to both cheaper technology, and lower finance deals for suppliers. “Meanwhile, coal and gas have got more expensive on the back of lower utilisation rates.” These lower costs have seen windfarms £20 cheaper per megawatt hour than gas or coal-fired plants. The trend down in costs for renewable energy production is true across the board, with costs for solar also falling as fossil fuel energy production costs continuing to increase. This may have a huge impact over time, as renewables will no longer be seen as an expensive and inefficient form of energy.

Poor Take Up

Great news then, for a government committed to low carbon energy production. Surely they will be rushing to build more onshore windfarms? Not so. In fact, the Conservative government are cutting back on windfarm subsidies, preferring instead to target investment into nuclear power. This decision has incensed the green lobby, who are convinced that the government are ‘backing the wrong horse’. Others counter with the charge of intermittent generation, and maintenance down time for wind turbines, against the reliable, round the clock clean energy production possible from nuclear power plants.

The Future is…?

The debate rages on, and at present the government is not persuaded by the arguments for on shore wind farms. The BNEF report may influence decisions in future, but for now wind farms are coming up on the outside, but in no danger of overtaking in the carbon free energy race. That race will intensify in the next two decades, and it will be interesting to see how this new report impacts on decision making. We could be seeing an increase in on shore windfarms in coming years. Public opinion is coming round to the idea, as evidenced in this 2012 ICM/Guardian poll on attitudes to renewables. Whilst it shows a tripling of local objections to windfarms since 2010, the majority (60%) of the population are firmly in favour of wind power. Objections from those who have wind turbines in their eye line will no doubt continue, but it is the bottom line which will sway policy, and with technological improvements enabling big strides in efficiency, it may not be long before pragmatism overtakes aesthetics.

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Energy Company NumbersView all posts by Energy Company Numbers
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