Energy: Wind Generation

House of Lords written question – answered at on 28 June 2011.

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Photo of Baroness Gibson of Market Rasen Baroness Gibson of Market Rasen Deputy Chairman of Committees, Deputy Speaker (Lords)

To ask Her Majesty's Government what is their assessment of the value for money provided by offshore wind as an electricity generating technology, based on the projections of the cost per megawatt hour contained in Mott MacDonald's report UK Electricity Generation Costs Update for 2010 used and quoted by the Department of Energy and Climate Change in its consultation on Electricity Market Reform.

Photo of Lord Marland Lord Marland The Parliamentary Under-Secretary of State for Energy and Climate Change

The cost projections in the Mott MacDonald report were produced to provide an up-to-date set of assumptions on the costs of generation technologies at that time, to inform government policy. Mott MacDonald's assumptions on the costs of different electricity generation technologies were used to inform the modelling of the electricity system for the electricity market reform (EMR) project.

The results of this modelling formed part of the assessment of the EMR options. They have not been used to provide a value for money (VFM) assessment on offshore wind nor other technologies, and the department has not carried out such a VFM assessment. The most recent independent projections on levelised generation costs are contained in a 2011 report Review of the generation costs and deployment potential of renewable electricity technologies in the UK, produced by Arup, and recently published by the department.

1 Mott MacDonald (2010), UK Electricity Generation Costs Update, can be found at http://www.decc.gov.uk/assets/decc/Statistics/Projections/71-uk-electricity-generation-costs-update-.pdf

2 Arup (2011), Review of the generation costs and deployment potential of renewable electricity technologies in the UK, can be found at http://www.decc.gov.uk/en/content/cms/news/pn11_47/pn11_47.aspx

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