Entreprenuers refuse to tilt at windmills as government renewable drive flops.

Offshore wind entrepreneurs fought shy of the UK’s subsidised auction of renewable energy programmes leaving the government open to severe criticism calling it a flop.

The offshore wind drive is a keystone of the UK government’s decarbonisation goals.

The government’s decarbonisation aims

The government aims for 50 GW of offshore wind in operation, by 2030. Right now, that figure is around 14 GW.

This auction round was supposed to bring in a large amount of this by attracting offshore wind power projects.

But this auction price of £44 per MwH, was too low for entrepreneurs – they feared for their costs. All that was gathered were small solar, tidal and shore projects for 3.7 GW. 

Price guarantee for energy

The contract-for-difference (CfD) scheme, which was launched in 2014, offers renewable power developers a guaranteed price for their electricity.

“By capping the price the sector could bid at too low, the government set it at a level that made it impossible for investors to meet their costs,” renewable energy campaign group Britain Remade said in a statement.

Hang its head in shame

Shadow climate change secretary Ed Miliband believes the government should hang its head in shame. 

“For month after month, the government was warned by the industry that unless they adjusted the auction price something like this was going to happen and indeed it has transpired. It seems impossible for the government to raise the price, to take account inflation, and you can still and you can be saving money, consumers will be saving money,” says Miliband.

“Offshore wind is central to our ambitions to decarbonise our electricity supply and our ambition to build 50GW of offshore wind capacity by 2030, including up to 5GW of floating wind, remains firm,” Energy and climate change minister Graham Stuart told Reuters.

Dithering and complacency by governments on renewable energy are quite common around the world.

Energy in Africa

I reported on the renewable energy issue in power-strapped South Africa for years. 

At conferences, politicians would wax lyrical about the wind and sun, implying their abundance in Africa would be easy.

The South African government – facing a growing electricity shortage – launched a round of preferential renewable energy contracts at a subsidised price. The idea was to make South Africa a highly skilled renewable energy hub in Africa. 

Hurry up and wait

Renewable energy entrepreneurs queued up for the contracts and invested millions. 

Yet, it took an age for the government to cough up the money. Officials even haggled over the price.

It was so complicated and took so long that entrepreneurs left to take up other opportunities, taking their skills and investments with them.