Now that the government has called for a review of the contract for the Hinkley point C nuclear power station many are wondering if this is a very expensive white elephant. Whether or not you agree with the proposal for Hinkley Point this may at least provide food for thought. Care is required though as she works in renewables.
Sonja van Linden Tol, Global Head of Sales for Clean Energy Pipeline, published on Linkedin the following is an interesting take on the subject.
ANALYSIS: The case against Hinkley Point C darkens after record year for offshore wind
- Published on August 3, 2016
One particular sore-point for many renewable energy industry figures and analysts over the furore surrounding the £18 billion Hinkley Point C nuclear power project is the guaranteed strike price of £92.50 per MWh for 35 years.
The deliberation of such as a costly project comes amid a backdrop of DONG Energy achieving a record-low strike price from success with the 700 MW Borssele 1 and 2 tenders at Eur87 per MWh.
Clean Energy Pipeline’s figures show that project finance investments for offshore wind projects in the first six months of the year totalled a record $19 billion, which marked an over 30% increase on the $14.5 billion invested in the sector in the same period in 2015, allowing for the financial closure of 4.58 GW of offshore wind projects.
At a time of great difficulty for the UK’s offshore wind sector, it is important to note that the industry was responsible for over 74% of the global offshore wind investments made so far this year at a staggering $14.1 billion.
These came from four flagship offshore projects being developed across various parts of the British coast.
They were the 588 MW Beatrice offshore wind farm [SSE plc (50%), Copenhagen Infrastructure Partners (25%) and SDIC Power (25%)], the 402 MW Dudgeon project [Statoil (35%), Masdar (35%), and Statkraft (30%)], the 1.2 GW Hornsea Project One wind farm [DONG Energy], and the 714 MW East Anglia 1 project [Scottish Power Renewables].
Greenpeace’s Executive Director John Sauven was one such detractor against EDF’s Hinkley Point C project, specifically pointing to the ever-declining cost of offshore wind compared to nuclear.
In an emailed statement, he said: “The UK government doesn’t have to sign the contract with French and Chinese state owned companies. The government should make the sensible and pragmatic decision to quit while we’re still ahead. We need a clean break from Osborne’s pet projects.
“The new government should have the vision to come up with a serious plan to boost our energy infrastructure that will keep the lights on and the costs and carbon emissions down. This isn’t going to be delivered by outdated nuclear technology and handing over the keys to our energy system to companies associated with the Chinese military.”
Having achieved an average strike price of about £117 per MWh for the two UK offshore wind projects which received CfDs last year, it meant that the UK was well on track to achieve the government target of £100 per MWh by 2020.