User:Adissentient/sandbox

Auction prices
In the UK's Contract for Difference auctions of 2017 and 2019, offshore windfarms made bids to supply the grid at strike prices much lower than anything seen before: £57.50/MWh in the 2017 auction and £39.65/MWh in the 2019 one. These values are below the ostensible windfarm costs outlined in the previous section, and have therefore been widely taken as evidence of a fundamental change in the economics of offshore wind power; in other words that technological advances have led to much lower costs. However, others have argued that low auction bids are likely to be part of a complicated bidding strategy, noting that Contracts for Difference can be cancelled with relatively small penalties.

There has been no similar reduction in bidding prices from onshore windfarms. The lowest successful bid under the CfD regime has been £79.99/MWh.

Effect on consumer bills
Wind power affects consumer bills in several different ways:


 * direct subsidies - whether through the Renewables Obligation or Contracts for Difference - have to be paid for
 * because wind and other renewables have priority access to the grid, they undermine the economics of fossil fuels operators
 * it increases the cost of balancing the grid.