Why did the cost of offshore wind go up?

Green lobbying organisations have tried to explain the rising cost of wind power on other forces. But their explanations do not seem to survive inspection.

One of the things I have been meaning to do for a while is answer some of the claims that green campaigners have made to try to explain the failure of the government’s recent Contracts for Difference auction to attract any bids from developers of offshore wind farms. Greens have, of course, been crowing since the start of the CfD scheme that the costs of offshore wind have fallen dramatically. But as the following chart (used in an earlier post here) shows, these ‘cheaper than gas’ wind farms have yet to produce power under the CfD scheme. Worse, following the most recent auction, the government significantly increased the ‘administrative strike price’ (purple line) they were expecting for the next round.

Lobbyists and campaigners were keen to blame the government for the failures. But the fact remains that the low prices they have been promising for the duration of renewable energy schemes look forever further away than the promise of fusion. Over the duration, domestic energy prices tripled, and industrial energy prices rose more than 500 percent. And now the government, rather than calling the green energy sector out, has simply caved in to their demands, and promises them more of our money. Some serious spinning was necessary…