Offshore CfDs

A recent article posted on Mondaq discussing recent CfD auction results could be argued to be somewhat hysterical. However, there's a paragraph in the middle posing a number of questions which, if you unwind them a little, pose one or two interesting crumbs of food for thought:-



Clearly, the cost of offshore wind power presents a challenge for other technologies in Pot 2 (and gas). They have no prospect of competing with offshore wind. The results present Government with many questions. Should offshore wind become a Pot 1 technology, to compete against onshore wind and solar? This could potentially enable consumers to earn a return (ie a reduction on the cost of electricity) for offering price stability to developers by awarding CfDs at below the market price. Should the focus be on offshore wind to the exclusion of all else? Where does it leave nuclear? Where does it leave gas? Does it represent an opportunity to use budget to support potentially complementary technologies, such as island wind (wind in Shetland for instance is relatively uncorrelated to wind off East Anglia) or tidal technologies. And finally, if the price of offshore wind is £57.50, could onshore wind be used, not just to cut subsidy, but to cut the cost of electricity to consumers?