True costs of wind power

Onshore wind in the UK already generates electricity at prices competitive with new conventional generation technologies, including nuclear[1], while offshore wind, initially more expensive, is starting to fall, with the general consensus that prices will reduce dramatically by 2020. Research conducted by OXERA for the Government's Renewables Innovation Review, published last week, cites current prices for onshore wind of 3.1 pence per unit (p/kWh), dropping to 2.7 p/kWh by 2010. Current costs for offshore wind are 5.5 p/kWh, predicted to fall to 4.4 p/kWh by 2010 and further falling to 3.7 p/kWh by 2020[2].

BWEA is also extremely surprised by the high figures quoted by the Royal Academy of Engineering for the cost of back up for wind energy. These fly in the face of research conducted for the Energy White Paper, published in the Government's Performance and Innovation Unit report of February 2002, which quoted a figure of 0.2 p/kWh for a 20% contribution from intermittent generation[3], more than eight-fold lower than the assumptions made by the Royal Academy of Engineering.

This low price for back-up will be further confirmed in a report due to be published shortly, highlights of which were presented to delegates at BWEAs 3rd annual conference on offshore wind energy last week. The report from the Carbon Trust, commissioned by the Renewables Advisory Board, will conclude that intermittency is not a problem for wind energy at levels up to 10%[4].

In relation to nuclear power, BWEA notes that the recent Energy White Paper[5] concluded that "the current economics of nuclear power make it an unattractive option for new generating capacity". BWEA further notes that the RAE report itself states that "Further scrutiny of the commercial claims for nuclear power would be useful because of the lack of data from existing new build projects." BWEA assumes that the figures quoted for nuclear are based upon reactors that are yet to be built and is not aware of any market experience that proves the costs claimed by the Royal Academy of Engineering. This is in contrast with onshore and offshore wind where real cost data of real existing projects are used to make economic forecasts.