* Offshore wind costs below 100 pounds per MWh
* Cost near that of new nuclear plants
* Govt signals continued support for the sector
LONDON, Jan 24 The cost of producing electricity
from wind farms off the coast of Britain has fallen 32 percent
in the past four years, meeting a government target four years
early, an industry report released on Tuesday said.
Britain plans to increase its offshore wind capacity to help
bridge a looming electricity supply gap as old nuclear plants
and coal-fired power stations close.
Offshore wind farm costs fell to an average of 97 pounds
($120.82) per megawatt-hour (MWh) in the 2015-2016 financial
year, from 142 pounds/MWh four years earlier, the report
commissioned by the Offshore Wind Programme Board said.
This means the industry has met ahead of schedule a
government target to cut costs to below 100 pounds/MWh by 2020.
It also puts the cost of offshore wind close to that of new
nuclear plants, with the government contract awarded to France's
EDF for its Hinkley C reactor project in southwest
England at 92.50 pounds/MWh.
"Thanks to the efforts of developers, the UK's vigorous
supply chain and support from government, renewables costs are
continuing to fall," Britain's energy minister Jesse Norman said
in a statement with the report.
"Offshore wind will continue to help the UK to meet its
climate change commitments, as well as delivering jobs and
growth across the country," he said.
Britain has a legally binding target to cut emissions of
harmful greenhouse gases, such as those produced by
fossil-fuel-based power plants, by 80 percent from 1990 levels
Developers of offshore wind projects, such as DONG Energy
, have driven down costs rapidly over the past few
years by increasing the size of turbines.
However, critics say that even with recent cost reductions,
offshore wind remains much more expensive than traditional
fossil-fuel electricity generation, while some environmental
groups say the huge structures could harm marine life.
Norman said offshore wind would be an important part of the
government's new industrial strategy, which was unveiled on
Monday and includes delivering affordable, low-carbon energy
More than 9.5 billion pounds ($11.8 billion) has been
invested in offshore wind in the United Kingdom since 2010, the
report said, with another 18 billion pounds due by 2021.
($1 = 0.8028 pounds)
(Reporting by Susanna Twidale; Editing by Dale Hudson)