The UK Government has launched a consultation on support for
island renewables projects.
Earlier this month, the Government announced a strike price for
island onshore wind at £115 per MWh. This is £15 higher
than the strike price for onshore wind on the mainland. The
intention is clearly that the strike price will be a sufficient
bridge for the higher development costs on the islands (not least,
the significantly higher transmission costs).
Whilst industry gave a cautious welcome to the higher strike
price, it was clear from responses to the earlier announcement that
developers did not see the strike price on its own as being enough
to encourage large-scale investment. Mindful of that, but showing
some reluctance to let go the purse strings, the new consultation
exercise is intended to test whether the strike price on its own
could support – as Government quite deliberately expresses it
– the "more cost-effective projects".
