Britain guarantees prices for offshore wind projects to power 12 million homes

On Wednesday the British government said it would provide guaranteed electricity prices to a group of offshore wind farms off England, Scotland and Wales that would, once built, provide power for 12 million homes. The support covers 8.4 gigawatts of capacity, the largest amount secured in a British auction, and mainly targets projects off eastern England with additional awards for Scotland and Wales.

RWE was the largest winner and said it would team with KKR and Masdar; SSE also won price support. A Bernstein analyst, Deepa Venkateswaran, wrote that the results "have confirmed the revival of offshore wind in U.K./Europe." The government runs these auctions roughly annually and results have been improving after a failed 2023 auction that produced no bids.

The average strike price, or floor, from the auction was about £91 (roughly $122) per megawatt-hour in 2024 prices, while Drax Electric Insights said the wholesale price over the past year averaged about £79 per megawatt-hour. The government says it wants at least 95 percent of the country’s electricity generation from clean sources by 2030; Ed Miliband, the energy secretary, said in a statement that "clean, homegrown power is the right choice for this country to bring down bills for good." The article contrasted Britain’s move with the United States, where it said President Trump has all but killed off offshore wind.

Some analysts warned the system could lock in high prices.

Key Topics

Business, Offshore Wind, England, Rwe, Kkr, Masdar