Photo: Dogger Bank
The UK just pulled off one of its most consequential offshore wind auctions yet – delivering massive volumes of new capacity at prices that undercut gas.
In its latest offshore wind allocation round (AR7), the UK awarded a record 8.4 gigawatts (GW) of offshore wind capacity, making it the largest-ever offshore wind auction in Europe. That includes 8.2 GW of bottom‑fixed projects and just under 200 megawatts (MW) of floating wind, enough clean power to supply the equivalent of nearly 10 million homes.
And it came in cheap. Thanks to intense competition, the average strike prices landed at £91.20 per megawatt-hour (MWh) in England and Wales and £89.49/MWh in Scotland. That’s well below the cost of building and running new fossil fuel or nuclear power in the UK.
For context, new gas plants in the UK are estimated to cost approximately £147/MWh, while new nuclear power plants come in at around £124/MWh. In other words, offshore wind from this auction is roughly 40% cheaper than gas and almost 30% cheaper than nuclear.
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The 8.4 GW of new offshore wind capacity will save consumers nearly £1.7 billion a year compared with relying on gas-fired power.
A highly competitive auction
AR7 was one of the most competitive offshore wind auctions ever held in Europe. A record 19 projects with a combined potential capacity of 24 GW were eligible to bid, driving prices down and underscoring just how far offshore wind costs have fallen.
In total, the auction awarded contracts to six bottom‑fixed offshore wind projects and two floating wind projects. The 192 MW of floating wind awarded may sound small, but it’s an important step toward advancing commercial‑scale floating wind – a technology seen as critical for deeper waters where traditional turbines won’t work.
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