We are told offshore wind industry problems are either temporary or specific to the United States. This does not justify a renegotiation of the UK Hornsea 3 15-year CFD contract that already includes price protection against supply chain inflation.
The article claims that “Putin’s war” “caused Britain’s energy shock” but the cost of UK natural gas3 is now only a third of the price when the auction took place. It says that wind provides energy security but overlooks the historic role of North Sea oil and gas - or the possibilities of fracking - that would achieve this more effectively.
It is argued that the current cost of gas power justifies a refund from the Treasury to wind power generators, dismissing the role of carbon taxes in doubling gas power prices in the first place, which is the basis of his “reverse subsidy” claim.
If wind generation is so obviously “cheap”, consider why wind operators require a guaranteed price for their power generation.
When the wind blows, we already have a glut of power which cannot be cost effectively stored or exported, with very low or even negative power prices reflecting wasteful economic activity.
Mr Evans Pritchard admits “wind is not 24/7 baseload power” and suggests that this can be overcome by gas plants today or hydrogen tomorrow, without considering the extra costs of this duplication or how there is no historical precedent for replacing economically superior products with those which are inferior or unproven.
Plans to triple UK offshore wind production won’t make the wind blow in the Irish Sea when it’s not blowing in the North Sea but will further increase the volatility of UK power prices.
Wind operators don’t care because the government has guaranteed them a price for their increasingly useless product, the costs of which are funded by UK electricity consumers.
The article concludes that I imply that “Britain should repeal the Climate Change Act”, which Prime Minister Sunak recently admitted was debated without due democratic process4.
Now that the costs of “Net Zero” are becoming clearer should we really be bound by the most ill-considered economic suicide note in history?
1 See https://blog.argonautcapital.co.uk/articles/2023/11/01/ding-dong-another-wake-up-call-for-wind-enthusiasts/ and https://blog.argonautcapital.co.uk/articles/2023/10/25/britains-a-goner-with-the-wind/
3 I refer specifically to the ICE UK Natural Gas Futures contract now trading at £12 per MMBtu compared to £36 per MMBtu in July 2022
4 “The last Carbon Budget process was debated in the House of Commons for just 17 minutes and voted through with barely any consideration given to the hard choices needed to fulfil it.” Rishi Sunak, UK Prime Minister, September 20th, 2023