The Economic Impact of Offshore Wind Farm Development on Energy Pricing and Market Dynamics in the UK

Project Description:

This PhD scholarship is sponsored by industry partner, RenewableUK.

This project focuses on evaluating the economic effects of offshore wind farm development on UK energy markets, including energy pricing, market dynamics, and the role of emerging technologies.

The UK is a global leader in offshore wind energy, housing some of the largest wind farms and aiming to generate one-third of its electricity from this source by 2030. This transition supports the country’s commitment to reducing carbon emissions and positions offshore wind as a crucial component of a clean and affordable energy system.

The UK’s commitment to offshore wind power is essential to meeting its carbon reduction goals. This proposal investigates the economic implications of offshore wind farm development on energy pricing, supplier strategies, and consumer behaviour while considering the integration of various renewable technologies such as onshore wind, energy storage, and wave and tidal power.

By examining the infrastructure connecting offshore wind generation to consumers—specifically underwater export cables and substations—the project will analyse how these factors influence prices, tariffs, and the overall energy market in the UK. The research will begin by mapping renewable energy resources and the necessary infrastructure to support offshore wind development, focusing on the geographical distribution of resources and their complementarity with other renewable sources regarding reliability and grid stability. It will also explore how offshore wind developers price their energy in relation to competitors and consider factors like infrastructure investment and operational costs.

We aim to evaluate the impact of offshore wind energy supply on consumer electricity prices and explore the relationship between generation and consumer demand patterns during peak and off-peak periods, analysing how pricing structures adapt accordingly.

This research will primarily focus on quantitative analysis to comprehensively examine the economic dynamics of offshore wind energy. Specifically, it aims to explore how innovations in one renewable energy technology (such as offshore wind) influence the adoption and performance of other technologies like solar and tidal energy. This approach will enable us to map the renewable energy market by analysing how producers strategically set prices depending on the technologies they use and the extent to which these technologies overlap or complement each other. Furthermore, we will investigate how investments in offshore wind infrastructure may create positive or negative externalities for other renewable sectors and how these spillovers shape overall investment strategies, risk assessments, and capital flows across the broader energy market.

If you have any queries about this project, please contact Dr Anna Rita Bennato,  a.bennato@lboro.ac.uk  

You may also address queries about the CDT to auracdt@hull.ac.uk.