Addressing recent misreporting of findings from “Better estimates of LCOE from audited accounts – A new methodology with examples from United Kingdom offshore wind and CCGT”

Abstract

Recent interest in the Levelised Cost of Energy (LCOE) for offshore wind has led to considerable media coverage of this topic. The paper to which this article refers provides some useful insights, but the authors are concerned that their findings are being misreported and misinterpreted. Specifically, some of the media coverage appears to misunderstand or disregard the acknowledged limitations of the paper, citing it to support contentions regarding the likely trajectory of costs for offshore wind farms. This research note addresses some of these issues and urges caution in use of the original paper’s findings. This new research note recapitulates the main themes of the original paper and directly addresses the areas where its findings have apparently been misunderstood. It concludes with a restated and reinforced warning that the analysis and projection of historic costs in offshore wind, or indeed in any fast-developing technology sector, should be undertaken with extreme caution when used to consider future cost trends.