Breaking: UK Offshore Wind Strike Prices Slide Down to GBP 39.65/MWh
Offshore wind projects selected in the third Contracts for Difference (CfD) Allocation Round 3 will be delivered at a strike price as low as GBP 39.65/MWh, a near 30% reduction compared to the second CfD auction held in 2017.
For the first time renewables are expected to come online below market prices and without additional subsidy on bills, meaning a better deal for consumers, the UK Department for Business, Energy & Industrial Strategy (BEIS) said.
In total, six offshore wind projects with a combined capacity of 5,466MW have been selected in the CfD Allocation Round 3, with the strike prices ranging from GBP 39.65/MWh to GBP 41.61/MWh. The strike prices are in 2012 prices.
The six selected projects are the 1,200MW Doggerbank Creyke Beck A P1, the 1,200MW Doggerbank Creyke Beck B P1, the 1,200MW Doggerbank Teeside A P1, the 12MW Forthwind, the 454MW Seagreen Phase 1, and the 1,400MW Sophia Phase 1.
The projects will be commissioned between 2023 and 2025 and will power over 6.8 million UK homes, according to the BEIS.
Doggerbank Creyke Beck A P1, Doggerbank Creyke Beck B P1, and Doggerbank Teeside A P1 are being developed by Equinor and SSE in the Dogger Bank region of the North Sea.
Doggerbank Creyke Beck A P1 will be developed at a strike price of GBP 39.65/MWh and the project’s first phase is expected to come online in 2023/24. The strike price for Doggerbank Creyke Beck B P1 and Doggerbank Teeside A P1 is GBP 41.61/MWh and the wind farms’ first phases are due to come online in 2024/25.
“The successful bids for the world’s largest offshore wind development represent a game-changer for our offshore wind business and support the development of Equinor as a broad energy company. A full-scale development of Dogger Bank will constitute an industrial wind hub in the heart of the North Sea, playing a major role in the UK’s ambitions for offshore wind and supporting the net zero ambition. Excellent wind speeds, shallow waters and scale make Dogger Bank well positioned to deliver low cost renewable electricity to UK homes and businesses,” said Eldar Sætre, CEO of Equinor.
Due to be commissioned in 2023/24, the 12MW Forthwind will be developed by Forthwind Limited offshore Scotland at a strike price of GBP 39.65/MWh.
The 454MW Seagreen Phase 1 is being developed offshore Scotland by SSE plc. With a strike price of GBP 41.61/MWh, the wind farm’s first phase is due online in 2024/25.
The 1,400MW Sophia is being developed by innogy. With a price of 39.65/MWh, the first phase of the wind farm will be delivered in 2023/24, with the full commissioning scheduled for 2026.