No companies have bid for the UK’s latest round of offshore wind farms in a step seen as a serious setback for the Government’s climate change ambitions, after months of warnings from industry players.
With Rishi Sunak discussing the transition to net zero at a G20 summit in India, the lack of interest in the annual auction round put a dent in ministers’ promise to deliver 50 gigawatts (GW) of offshore wind by 2030.
Analysts said the offshore failure will add £1 billion to UK energy bills with the power grid forced to rely more on the volatile gas market, where prices soared after Vladimir Putin’s invasion of Ukraine.
“This monumental failure is the biggest disaster for clean energy in almost a decade,” Greenpeace UK’s policy director Doug Parr said.
The development puts the UK’s legally binding target of decarbonising power by 2035 “in greater jeopardy”, he said.
The Government stressed newfound interest in the auction round for solar, onshore wind, tidal power and geo-thermal. Last week, ministers caved to a Commons rebellion and agreed to relax a ban on new onshore projects.
The Department for Energy Security and Net Zero said the lack of interest in bidding for new offshore wind farms was “in line with similar results in countries including Germany and Spain, as a result of the global rise in inflation and the impact on supply chains which presented challenges for projects participating in this round”.
Foreign Secretary James Cleverly insisted that Britain was “already seen as a world leader in offshore wind production”. It has the world’s second-biggest market after China.
Heading into the G20 summit, “the UK has shown that you can cut emissions, grow the economy, stimulate technology”, Mr Cleverly told GB News. “It’s a really good success story and one we should be proud of.”
But companies have been long warning that unless the Government agreed to raise the price they could charge for offshore wind, to take account of surging costs, they would be unable to bid this time.
ScottishPower is a leading player in a market dominated by foreign companies, which have been lured by increasing inducements from other governments. Its boss Keith Anderson said: “The economics simply did not stand up.
“This is a multibillion-pound lost opportunity to deliver low-cost energy for consumers, and a wake-up call for Government,” he said.
Ed Miliband MP, Labour’s shadow energy security and net zero secretary, said: “The Conservatives have now trashed the industry that was meant to be the crown jewels of the British energy system - blocking the cheap, clean, homegrown power we need.
“Ministers were warned time and again that this would happen, but they did not listen. They simply don’t understand how to deliver the green sprint, and Rishi Sunak’s government is too weak and divided to deliver the clean power Britain needs.”
