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Promising Forecasts – Precarious Future

The future of offshore wind in the UK is bright but the industry has to contend with a number of challenges. To ensure continued development, the UK government has set out a long term plan for the renewable energy sector.

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Look no further than the wind industry in 2016 for a new year full of growth and economic benefits in the UK – literally. RenewableUK says the next twelve months are going to be a busy for construction activity onshore and off, but beyond that there is considerable uncertainty.

The predictions are huge. Three times the capacity installed in 2015 are due to come online in 2016 as more than 50 projects become fully operational bringing with them 1.2GW of new capacity. They’ll generate more than £913m of investment during the development and construction phase. That’s not all: construction on another five projects is going to get underway and that will contribute a further 1.9GW of capacity. The industry body says the economic benefits from developing offshore projects will amount to £5.9bn over the next five years.

Faced with uncertainty over future access to the energy market, onshore wind developers seek to complete projects before current market arrangements end in 2016. RenewableUK deputy chief executive Maf Smith said “Onshore wind is one of cheapest of all sources of electricity for consumers. Ministers need to give onshore wind projects access to the energy market. Without that, Britain will lose out on billions of pounds of future investment.”

Having thrown off the shackles of the green Liberal Democrats, the Conservatives have, as one local paper put it, “taken a sledgehammer to the renewable energy policy.” However industry insiders are bullish – take Merlin Hyman from Regen South West who said, “Clearly, 2016 will be a tough year for people working in renewables, but it is now just a matter of time before they become the backbone of our energy system.”

There’s quite the mountain to climb. Government policy has scrapped subsidies a year early and practically crippled the progression of any new turbine development (with the insistence that approval from the government would only come if the local community backed them) and attempts to overturn decisions are apparently fruitless with figures showing that in the last six months only one appeal by a developer has been granted following a council refusal.

At the end of last month figures from the Department of Energy and Climate Change showed from July to September the amount of electricity generated by offshore wind had increased by 52% compared to the same time the year before and onshore wind enjoyed an increase of almost a third.

Smith sees this and the knock-on economic benefits as clear reasons why the UK government must maintain its support for the sector. “The UK’s wind energy infrastructure pipeline remains healthy in the immediate term, continuing to bring billions of pounds of investment to British companies across the supply chain and supporting 35,000 jobs.

“Our main focus at the moment is driving down the cost of wind energy even further, to help consumers. The more we install, the cheaper the clean electricity we generate becomes. That’s why we’re keen to see onshore and offshore wind continuing to play a central role in our wide-ranging energy mix. The growth of wind energy in the UK is a cause for celebration. We’re keeping the lights on, keeping cost to the consumer down, and making sure we deliver on our climate change responsibilities.

“No government would want to jeopardise the successful future of such an industry. Government understands this and has set out a long term framework for offshore wind, allowing industry to plan ahead.”

Whether that optimistic sentiment will prove to be well placed or naive will remain to be seen. But it’s a nice way to start 2016. Happy New Year all!