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Offshore wind paying its own way

Are renewables becoming the cheaper option?

A UK-based team of researchers has a bold prediction. In three to four years at the latest, wind energy will be cheaper than fossil energy in Germany, Belgium, the UK, the Netherlands, and Denmark.

Building and operating wind farms was, for a long time, only possible with government subsidies. These times, according to a study in Nature Energy, are finally over. Offshore wind farms approved in 2020 could be built with such efficiency as to no longer need any subsidies. The researchers predict just three to four years until wind energy is even cheaper than fossil fuel – which in Germany receives subsidies of around 4.1 billion euros a year.  

Winds blow, prices fall 

Between February 2015 and September 2019, British researchers studied the renewable energy market in five different European countries. They focused mostly on electricity auctions, wherein contracts are awarded to electricity producers whose plants require the fewest subsidies to build and maintainDuring their researchthey observed prices for offshore wind farm electricity falling at an impressive 12 percent a year.  

Renewables beat fossils – ecologically and economically 

On average, the research shows that a megawatt hour costs as little as 51 euros, roughly on a level with fossil fuels. The value of the subsidies was also shrinking; some projects in Germany and the Netherlands are already getting by without subsidies at all. In the UK, prices for electricity consumers may even fall in the foreseeable future. 

While it has long been clear that renewables were the more ethical option, we will soon face a reality where they are the cheaper option. The competition in the energy markets is picking up – and wind may soon emerge on top. 

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