The predicted price of onshore wind in Germany is now half the EU’s projections for 2030, following an auction in Germany this week.
The auction results were described as “incredible” by one expert.
The average price at which contracts were awarded in the 1GW auction was €38/MWh, the German regulator Bundesnetzagentur announced on Wednesday.
That’s a drop of one third on the price from six months ago and a drop of 10% since the previous auction in August.
The bids are based on companies’ predictions for the next few years, as they now have four and half years to complete their projects. If a bidder finds they cannot profitably provide energy at the price agreed, they must pay a penalty fee to withdraw.
Bundesnetzagentur said the bids were based on “anticipated positive developments in plant technology and falling prices.”
Last year the European Commission predicted onshore wind costs of €80/MWh for 2030 and €75 for 2040, which include the costs of distribution and transmission.
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Yesterday, I talked about the exponential growth in solar round the world, as the price of solar plunges. Today, it's wind's turn. Remember, because wind and solar are at worst uncorrelated, and at best negatively correlated, a blend of both in the electricity grid minimises variability and the need for storage. And anyway, if wind farms are far enough apart, their output is uncorrelated, meaning that the output of geographically separated wind farms approaches baseload. Meanwhile, even though more storage will be needed for a 100% renewable electricity supply, the cost of storage is also plummeting. There are no longer any financial or technological impediments to a 100% renewables electricity grid.