Renewable energy –

Rueing the waves

SINCE October sightseers on the hills above Edinburgh have gawped at a brand new

landmark. Across the Firth of Forth, on a test site, stands the biggest wind turbine in Britain. The tips of its blades rise 196m above sea level. Its

rotor sweeps an area twice as large as the London Eye. This monster and others like it are bound for

the North Sea—part of the biggest and most ambitious offshore wind programme in the world. 

Britain gets more electricity from offshore wind farms than all other countries combined. In 2012 it added

nearly five times more offshore capacity than Belgium, the next keenest nation, and ten times more than

Germany. Its waters already contain more than 1,000 turbines, and the government thinks capacity could

triple in six years. Boosters think Britain a global pioneer. Critics say ministers are flogging a costly

boondoggle. Two things explain Britain's enthusiasm for offshore

wind turbines. First, the country is committed by European law to generate about 30% of its electricity from renewable sources by 2020, up from about 13% now. Nuclear energy does not count and Britain is well behind on solar power, which means lots more wind turbines and biomass plants (mostly wood-burning

power stations) will be required. 

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The simplest solution would be to put more wind turbines on land. But they are unpopular with locals: rural voters have harried several Conservative MPs into

outright opposition. So Britain is building much of its new capacity at sea. Offshore turbines supply less than 3% of Britain's juice but about one-fifth of its renewable power (see chart). That share is rising. 

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The second reason for ministers' enthusiasm is that they spy a chance to conquer a growing

global market. Miles of shallow sea give Britain an unrivalled opportunity to experiment with

technologies it may one day lucratively export, much as North Sea oil has turned Scotland into

a hub of hydrocarbon expertise. China and Japan have a growing appetite for offshore

generators but little capacity. America has only a single prototype turbine. 

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Unfortunately, offshore wind power is staggeringly expensive. Dieter Helm, an

economist at Oxford University, describes it as "among the most expensive ways of marginally

reducing carbon emissions known to man". Under a subsidy system unveiled late in 2013, the government guarantees farms at sea £155

($250) per megawatt hour for their juice. That is three times the current wholesale price of

electricity and about 60% more than is promised to onshore turbines. It is also more than the £92.50 which Britain's new nuclear

plant at Hinkley Point will get—though that deal is for 35 years, not 15. 

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Ten-metre waves and salty gales are just two of the hazards that keep

offshore costs high. Second-world-war bombs on the seabed are slowing new

projects in Germany; in December Scottish Power, an energy firm,

scrapped plans for 300 turbines on a site filled with basking sharks. 

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The government wants offshore generators to slash costs by about one-third by 2020. The

price of energy from offshore farms has actually risen since Britain built its first turbines at sea in the early 2000s, in part because developers are putting them in ever deeper waters, farther

from land. But costs now appear to be stabilising. Operators claim bigger turbines can bring prices down. Simpler models that break

less ought to help matters, too. In some places floating wind farms could prove cheaper than fixed foundations. To cut losses from outages, offshore operators are investing in helicopters to whizz engineers to stricken turbines when

seas are too rough for boats. 

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Another hitch is that much of the money lavished on building offshore wind farms

leaves the country. Only about 25% of capital spending flows through British companies, compared with 70% of the cash invested in

North Sea oil and gas. Almost all of the country's existing offshore turbines were

produced by two firms, Siemens and Vestas, which manufacture them in Denmark. Fleets from continental ports commonly construct

the farms. 

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The government hopes British firms will one day shoulder at least half of the work new offshore farms require. Its industrial strategy, published in August, tries to give small businesses a leg up. But whereas local companies are already

good at many footling jobs, the real prize would be tempting a turbine manufacturer to build a

British factory. Lacklustre facilities at ports near the farms are one significant obstacle. 

Click to add titleThe industry says offshore wind power would

become cheaper more quickly, and boost Britain's economy, if the government agrees to build lots more offshore farms. The Department of Energy and Climate Change (DECC) says that

10 gigawatts (GW) of offshore capacity is "achievable" by 2020. That is three times the amount already deployed, and would provide

about the same capacity as Britain's nine nuclear power stations combined (although

wind farms produce power only about a third of the time). Still, ministers once had loftier

ambitions. Wind-farm operators worry that the government will divert subsidies to other kinds of low-carbon generation, such as nuclear and

gas-fired stations. 

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The Institute for Public Policy Research, a think-tank, warns that half-hearted investment in offshore power could leave Britain in the "worst of all worlds"—a moderate amount of

offshore energy, supplied at whopping cost and to little economic benefit. Enthusiasts want the government to boost investment by setting a binding target for carbon

emissions in 2030 and extending its support for new wind farms from 15 years to 25 years. In December, partly in

response to such concerns, DECC tweaked its subsidies to provide more cash to offshore farms that begin construction

at the end of the decade. It reaffirmed that Britain could have over 40GW of offshore capacity by 2030, if costs fall

quickly. That would mean offshore turbines supplying about a third of Britain's power. 

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Yet hefty subsidies will only get harder to defend as bill-payers grow angrier about rising

energy prices. And Britain is not the only country questioning its support for costly,

complex offshore generation. In 2012 European offshore deployment fell 14% behind its target;

in November 2013 politicians in Germany agreed to slash that country's objective from 10GW in 2020 to 6.5GW. One day mammoth

offshore turbines might herald cheaper power. For now they only supersize the gamble.