1)   Outlook for Investment into European Wind Generation

Europe, including the UK, has ambitious growth targets for the deployment of renewable generation, with the European Commission proposing to increase the EU’s RES Target for 2030 in the context of the current revision of the Renewable Energy Directive (RED III).


In particular, we have seen dramatic growth in wind capacity in Europe more broadly from about 200GW onshore and 30GW offshore today, to the projected growth of approximately 1,000GW of onshore and 450GW of offshore in 2050. We are expecting to see a dramatic acceleration from now through till 2030, in particular from the UK and Germany who have both increased their national offshore wind target from 40GW to 50GW (UK) and 20GW to 30GW (Germany) by 2030.


European wide investment needed

To achieve these targets however, requires massive financial investment. In terms of generation assets and infrastructure, the European Commission estimates that for meeting the RES-targets of the EU-27 for 2030, about 1 trillion of investment related to renewable energy will be needed by 2030 alone. WindEurope, the industry body for the European wind industry recently published their Financing and Investment Trends Report that retrospectively reviewed 2021. It found that:



2)   Steps required to unlock growth for UK

RWE strongly welcomes the government’s commitment to offshore wind from 40GW to 50GW, however this extremely ambitious new target has only accelerated the need for significant changes to policy, regulation and system design. It will require the deployment of approximately 5GW of offshore wind per year consistently out to 2030, in order to meet the target, as well as to build and maintain the domestic supply chain that will be necessary.


Ensuring we have the right transmission network

Even before the Government’s new target of 50GW, the current configuration was not set up to deliver 40GW by 2030. Given the new target, a step change in how transmission networks are developed is required at pace. In particular, we urgently need to update planning and investment models to ensure that networks are able to deliver power from generators – often in remote locations where they are most suited, for example offshore or in remote but windy parts of the UK – to demand centers. 


Connecting new renewable generation projects to the networks has been the single biggest issue impacting on the delivery of wind energy projects. To accelerate the development of the transmission network and ensure we can connect new projects we are calling for several changes:






Providing certainty for onshore transmission owners (e.g. National Grid) to enable them to invest in the network is critical. In particular, Ofgem needs to approve funding for the critical grid upgrades that will be needed to meet our 2030 targets and beyond. Ofgem’s remit with regards to net zero is restrictive and does not enable the regulator to facilitate the level of anticipatory investment required. This in turn is causing delays to the granting of grid connections, and consequently the development of projects. Clear guidance to Ofgem in this regard, in the form of an enhanced or changed remit that explicitly includes a responsibility to drive net zero would be useful.



Given the extremely tight timescales the industry faces to meet 2030 targets, planning and strategic approval processes need to be adapted to reduce bottlenecks within Government departments and agencies to prevent delays in the assessment and consenting processes.


RWE has welcomed the recent minded-to consultation published by Ofgem on anticipatory investment for in-flight offshore wind projects as part of the Offshore Transmission Network Review (OTNR). We consider this a positive step in enabling greater coordination between projects, however the pace at which Onshore Transmission Owners propose to roll out onshore grid reinforcements remains a concern.



A strategic refresh of National Planning Statements (NPS), Habitat Regulation Assessments (HRA), environmental planning and consenting is required to accelerate consenting for the most applicable offshore projects. This will require a more strategic approach to environmental compensation and protection, set in the context of a national level rather than project level approach. NPS and HRA legislation also needs better alignment to Net Zero policy and the British Energy Security Strategy (BESS), which clearly prioritises accelerated offshore wind deployment as a matter of national energy security. Finally, RWE believes that BEIS should consider building on the recommendations of the recent Future Offshore Wind Scenarios report prepared by ARUP for BEIS and The Crown Estate. A key recommendation of the report was “the need for whole system planning and integrated marine spatial planning”. A coordinated approach to future offshore wind development alongside technologies such as CCUS storage and oil and gas is increasingly required to minimise future conflicts before they occur, ensure coordination of mitigating measures on aspects such as noise pollution and provide longer-term certainty and visibility for developers on where the best opportunities are for unconflicted development.


Driving investment

As mentioned above, unlocking investment is essential to the deployment of offshore wind, and RWE has committed to spend up to £15 billion on green infrastructure in the UK by 2030. However, to unlock the higher financial investments needed, barriers need to be removed and the right frameworks and incentives put in place to make the necessary projects “investible”, particularly given international competition for investment.



To ensure investor certainty, support through the CfD mechanism should be continued and maintained in its current form as much as possible. Maintaining the current two-way CfD approach provides the certainty investors need to finance multi-billion pound offshore wind projects and reduces the cost of capital. This supports lower bills for consumers, as does the two-way nature of the scheme which sees generators pay back to consumers at times of high prices.


We welcome the move by BEIS’ to annual CfD auctions, providing further opportunities for a route to market via the CfD for offshore wind. However, we still need further certainty for developers through an auction schedule which provides delivery years, budgets/caps and expected capacity for upcoming auctions to 2030. This is crucial in providing a clear signal towards the British Energy Security Strategy (BESS) target of 50GW by 2030. RWE is prominent across European and international renewables auctions, and it is clear the UK is now a global outlier in not providing a clear and transparency auction schedule.



A significant ramp up of renewables will need massive additional investments in the supply chain. However, the opposite is currently the case with wind turbine manufacturers operating at losses and closing down factories.  This is partly due to increased commodity prices and international political developments, but also, because the turbine orders do not meet the expectations, as the regulatory frameworks across Europe - for instance related to permitting and risk-sharing - are not aligned with the high renewable energy targets. It is essential that Original Equipment Manufacturers are supported, or there is a major risk that they will struggle to ramp up production as required. Specifically in the UK, it is essential that the UK’s Government’s requirement for Supply Chain Plans cannot become a barrier to delivery of 50GW. Work needs to be done to assess the market in light of the 50GW announcement (and those of increased capacities across Europe) to establish the supply chain gaps and opportunities for investment. Actively identifying and then minimising supply chain bottlenecks should be a priority to support reaching the 50GW target.




30 May 2022