Offshore wind: All at sea?

The contracts provide generators with the certainty of a pre- agreed ‘strike price’ for their electricity so reducing the cost of financing and shielding bill payers from the volatility of the wholesale electricity market which has seen prices soar during the gas crisis. [...] LIMITING PREVIOUS CFD AUCTIONS Auctions are complicated and the organiser, the Low Carbon Contracts Company, has to set parameters to optimise the outcomes of price and volume, and maximise the stability of the project pipeline. [...] This could have been the case without the gas crisis, given the dramatic drop in the costs of renewables; and it will certainly be the case during the lingering gas crisis, given the sustained high price of gas that largely sets wholesale power prices. [...] In principle, the auctions could secure larger capacities, with the only legitimate limiting factors being the speed at which projects can move through the supply chain and the need to retain an incentive to submit the best bids. [...] 10 Furthermore, given the new paradigm of renewables being cheaper than the wholesale price for the foreseeable future, it might be helpful to re-evaluate the relevance of the use of the reference price and the budget pot.