DONG Energy Asserts It can Do Better than the Government’s Cost Target for Offshore Wind Farm
Dong Energy, the leading global offshore wind farm developer and operator, maintains that it can reduce the price tag of offshore wind farms very much lower than the 2020 government’s projection.
This news is a welcome development that will boost the industry’s economic feasibility since it is very much dependent on considerable subsidies coming from levies on the energy bills of consumers.
Government has instructed developers to significantly reduce costs to lessen the consumers’ burden. The goal set is £100/MWh( megawatt) for 2020. According to some specialists the target is unattainable. This makes the future of the industry uncertain if and when the target is not met.
Dong energy, however, claims it could trim down cost to £87/MWh or €100/MWh on projects it will develop until 2020. Dong’s 2012 projects have an average cost of €160/MWh.
According to the wind power director of Dong UK, Benj Sykes, the target is quite a challenge but the company thinks it’s a reasonable and attainable goal. what it plans to do to achieve the target is to build larger and stronger wind turbines with around a 200 m in diameter rotors. Dong announced that it would proceed with a big wind farm with wind turbines having rotors that are 154 m in diameter. But Dong energy said it requires a clearer explanation from the government on how subsidies will be apportioned to future energy projects.
If it is proven that offshore wind farms are cheaper than predicted, it could bring pressure to bear on the nuclear industry, which swore on being cost competitive with other low-carbon technologies.
The government is considering offering EDF, a nuclear company, a contract that assures a subsidy price close to £100/MWh for new reactors’ generated power. But, according to Sykes, subsidized offshore wind contracts in 2020 would still have to tender a price far above £87/MWh if these are contracts shorter in duration than the wind farm’s existence.