London – The cost of electricity from offshore wind has fallen dramatically in 2016 largely as a result of new competitive bidding programmes, according to a report from Bloomberg New Energy Finance.
The latest global figures show that offshore generating costs have fallen 22% during 2016, a 28% decrease compared to this time last year.
Competitive auctioning programmes, in which developers bid for projects at the lowest electricity price they can offer, have made a significant contribution, with 2016 breaking new records for cheap offshore generation: a tender in Denmark was won with a bid of only €60 per MWh.
Bigger turbines and enhanced construction knowhow were also mentioned as factors contributing to the declining costs.
Seb Henbest, co-author of the report, explained: “For years, offshore wind has been regarded as a high-cost option compared to onshore wind, solar PV, coal and gas. This study shows that the economics of offshore wind are now improving fast, with the best sites getting closer to striking distance of more mature technologies.”
Costs for other renewable energy technologies were also found to be falling fast, with onshore wind falling 16% in 2016, and record low electricity prices from solar reported.
Click to read the press release from the report in full.