A recent report from Bloomberg New Energy Finance (BNEF) has shown that energy based on the cost per megawatt hour, onshore windfarms are officially the cheapest form of energy available in the UK.
In the last year, the cost of producing electricity using windfarms has fallen from $108 (£71) to $85 (£55) per MWh. Compare this to the $115 it costs for the same amount of energy from a gas or coal powered plant, and the $190 that needs to be spent to get the same from a nuclear power station.
The costs cited (known officially as the levelised cost of energy (LCOE) are worked out according to a variety of factors including the cost of building the plants, and take into account issues like financing and intermittency, making for as fair a comparison as possible between the different forms of energy.
Dispelling the Myth
The latest figures from BNEF go a long way to dispelling the myth that renewable energy is too expensive or at the least uneconomical in a time when austerity measures are being implemented and pockets are being tightened around the globe.
Seb Henbest, the head of the BNEF’s European division, said: “Wind is now the cheapest technology in the UK and this means that old rules of thumb, such as ‘renewables are expensive’ or ‘unreliable’, need to be updated.”
He added that “some people still think that wind or other renewables are a luxury that we canot afford in difficult economic times but costs have been falling fast and they are now competitive (to a greater or lesser extent) worldwide.”
This all spells good news for campaigners for renewable energy who recently took a blow when our government announces that they would axe renewable energy subsidies and would be instating a ‘carbon tax’ on renewable energy plants.
Environmentalist activists Greenpeace, who have long been lamenting government energy policy are elated at the BNEF’s published figures.
Their chief scientist, Doug Parr, has said: “this is yet another major breakthrough for clean technologies that just go on smashing new records on efficiency and prices. As the production costs of coal, gas and nuclear power keep rising and those of wind and solar falling, it’s blindingly obvious that the UK government are backing the wrong horses. Millions of British consumers will pay for this mistake with higher bills to subsidise costly, outdates and polluting power sources.”
A government spokesman for the Department of Energy and Climate Change has put their own spin on things though, claiming that: “government support has driven down the cost of renewable energy significantly, enabling renewables to compete with other technologies and helping the industry stand on its own two feet.”