At a grim time for developers of offshore wind, Britain has come to the rescue.
On Wednesday, the British government said that it would provide guaranteed electricity prices for a group of wind farms off England, Scotland and Wales that would, once built, provide power for 12 million homes.
The news highlights the stark divide between the United States, where President Trump has all but killed off offshore wind, and northern Europe, where the technology, remains a mainstay for achieving ambitious clean energy goals, despite high costs.
“These results have confirmed the revival of offshore wind in U.K./Europe,” Deepa Venkateswaran, a utility analyst at the Wall Street research firm Bernstein, wrote in a note to clients on Wednesday.
The 8.4 gigawatts, a power capacity measure, that won support is the largest amount that has been achieved in an auction in Britain.
The government holds regular auctions, roughly on an annual basis. Results have been improving after a failed auction in 2023 that produced no bids from developers.
To encourage renewable energy sources like offshore wind, Britain offers a price floor to provide certainty for investors. The average floor, or strike price, from the auction on Wednesday was about 91 pounds, or $122 per megawatt-hour, in 2024 prices.
Over the past year the wholesale price for electricity in Britain was on average about £79, according to Drax Electric Insights, a market analysis website.
The bulk of the planned wind farms that won price supports will be off eastern England. Support will also go to wind farms off Scotland and Wales.
RWE, a German utility and the largest winner of the price supports awarded Wednesday, said in a statement that it would team up with the investment management firm KKR and Masdar, a clean energy developer in Abu Dhabi. SSE, a Scotland-based energy developer, also achieved success on Wednesday.
The British government wants at least 95 percent of the country’s electricity generation to come from clean sources by 2030. Political consensus for ambitious climate goals is eroding in Britain, but the government of Prime Minister Keir Starmer believes that an enormous bet on clean energy, especially offshore wind, is necessary to protect consumers from volatile fossil fuel prices.
“Clean, homegrown power is the right choice for this country to bring down bills for good,” Ed Miliband, the energy secretary, said in a statement on Wednesday.
Some analysts, though, say that the British system locks in high prices. “It is hard to escape the conclusion that when all the costs are factored in, the deals struck today will push bills up at a time they are already high,” wrote Sam Dumitriu, head of policy at Britain Remade, a research organization.
Stanley Reed reports on energy, the environment and the Middle East for The Times from London. He has been a journalist for more than four decades.
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