The development of the UK’s offshore wind sector 2010–16
What can this and future governments learn from the UK's successes in offshore wind policy in the 2010s?
The period from 2010 to 2016 has been rightly hailed as transformational for the UK offshore wind sector.
Through well-designed price support, the government unlocked low-cost capital for new projects and encouraged rapid technology innovation. This was supported by a long-term budget, clear new planning processes, competitive grid transmission licences and a Green Investment Bank. Installed UK offshore wind capacity increased sevenfold in those six years, while the prices paid for new offshore electricity are promised to decline more than fourfold from £150/MWh in 2016/17 to £37/MWh (in 2012 prices) for projects due for delivery in 2026/27.
This report looks at how the government initiated, designed and implemented offshore wind policy in the years 2010–2016. It draws on an Institute for Government policy reunion held in May 2023, which brought together officials, ministers, industry representatives and external experts involved in offshore wind policy at this time to discuss what made it an overall success, and what lessons the current (and future) government can learn to inform future net zero governance and decision making.
It finds that the key factors in success were:
- the clear mandate the now defunct Department of Energy and Climate Change (DECC) had to lead long-term electricity market reform, supported by legal commitments and the policy direction given by David Cameron and Nick Clegg
- the capacity and capability of DECC officials to deliver well-designed policy, aided by work that began under previous governments
- the use of effective mechanisms in the centre of government to co-ordinate a cross-government approach to developing the offshore wind sector.
The government’s April 2022 British Energy Security Strategy sets a goal for the UK to generate 50GW of offshore wind energy by 2030. But the offshore wind sector faces several stumbling blocks to reaching this aim – it will require greater support for supply chains, planning to be unblocked, faster grid infrastructure reform, and careful management of price support during the current period of high inflation. These are all things the government will need to urgently address if it is to ensure the UK offshore wind sector remains a success story.
- Political party
- Conservative Liberal Democrat Labour
- Department
- Department for Business, Energy and Industrial Strategy Department for Energy Security and Net Zero
- Public figures
- David Cameron Nick Clegg
- Publisher
- Institute for Government