Offshore Wind
Don’t do tenders based on price if you don’t know when the project can get built (ie if projects are still subject to permitting processes or legal recourse or other uncontrollable delays). That’s a sure way to get unrealistic bids that will then be subject to lobbying and renegotiation.
There were no successful bids from offshore wind projects in the latest CfD auction in the UK, and that is already described variously as a setback for net zero plans in the UK, and yet another nail in the coffin of the industry, already struggling from headwinds in the US and UK, where various projects are being cancelled or postponed, and PPAs abandoned or renegotiated.
But I actually take it as a good thing, in that (i) it reflects cost discipline, and (ii) it proves that the tariff design is smart in that it avoids crazy bids like we have seen in other markets.
Shares in the world’s largest offshore wind company have tumbled by nearly a quarter after it said it may have to write down the value of its US portfolio by nearly £2bn.
Ørsted said it had been hit by a flurry of setbacks in its American business, triggering a rapid sell-off in its shares, listed in Copenhagen.
Sunak’s next distraction will be ‘pylon wars’. Thousands of miles on high voltage cabling are needed to ship electricity from off-shore wind farms to towns and cities. This requires hundreds of thousands of new pylons. Everything that was off-shore and out-of-sight suddenly becomes an environmental battleground. Communities are already mobilising to challenge the process.
Maine will procure at least 3,000 megawatts of electricity from offshore wind turbines by 2040 under a bill signed Thursday by Democratic Gov. Janet Mills, enough to power about half of the state’s electricity load.
It isn’t just radio conspiracy theories, though. Mainstream Republicans and leading conservatives like former Fox News host Tucker Carlson — not to mention reality star Snooki — have been attacking Gov. Phil Murphy’s offshore wind plans as whales wash ashore. It’s a problem not just for the Democratic governor, who’s pinning his climate change agenda on coastal wind farms, but also for President Joe Biden.
The Biden administration is attempting to lower the cost of fixed offshore wind and support a domestic supply chain for the industry.
Republicans who oppose wind development after recent whale deaths off New Jersey said they will hold hearings in Washington on the issue, while a fishing group has attacked the federal body responsible for offshore wind.
