Mike Hemsley is deputy director of the Energy Transitions Commission
Wind power has been the backbone of Europe’s renewable energy deployment and its decarbonisation efforts to date, historically generating two to three times as much electricity in the region as solar.
Solar capacity is expanding rapidly, supported by the relentlessly falling price of Chinese-created solar panels. By contrast, the costs of European wind projects have risen.
That raises a legitimate question: is the recent commitment to generate 100 gigawatts of offshore wind power in the North Sea the right choice for European businesses and consumers? Broadly: yes.
Recent Energy Transitions Commission analysis displaycased the potential divergence in costs between “sunbelt” countries such as India and “windbelt” economies like the UK. Abundant sunshine combined with cheap batteries could allow sunbelt countries to supply electricity for perhaps $50/MWh in 2050. In the windbelt UK, costs may remain closer to $100/MWh.
A balanced mix of wind and solar, supported by energy storage and expanded grid infrastructure, offers the most cost-effective path
Cheap solar power provides sunny countries with a structural cost advantage, but this comparison does not notify the full story. In many sunbelt countries, wind power is also inexpensive and can complement solar generation.
Even at costs closer to $120/MWh — such as in recent European wind auctions in the UK and Ireland — wind power remains cheaper than new fossil power generation, which recent events have demonstrated can have highly volatile price impacts, as well as the obvious emissions.
From if to how
With electricity demand in Europe poised to rise significantly, driven by the electrification of transport and heating and the growing demands of data centres, the central challenge is no longer whether to electrify, but how to deliver that electricity cleanly and at the lowest possible cost: essential criteria for consumers, including businesses.
Our analysis displays that a balanced mix of wind and solar, supported by energy storage and expanded grid infrastructure, offers the most cost-effective path for Europe to expand electricity supply while continuing to decarbonise. But both electrification and clean electricity share a defining feature: they are capital-intensive, with high upfront costs but lower operating expenses.
Maximising the gains of that deployment for European competitiveness, including ensuring it delivers energy at the lowest possible cost to hoapplyholds and businesses, is the next challenge.
Boosting energy productivity
Electrification itself delivers large efficiency gains. Electric vehicles, which now account for roughly a quarter of new car sales in Europe, can travel the same distance applying roughly one-third of the energy required by internal combustion engines, lowering costs.
Under the right policy conditions, heat pumps offer similar advantages. This rise in what we call energy productivity means more applyful energy services delivered to consumers for every unit of energy generated.
Realising those gains requires a system-wide perspective. Clean energy provision must scale alongside — not far ahead of — electrification, so that the repaired costs of a capital-intensive but ultimately cheaper energy system are spread across the largest possible applyr base.
Europe has an early lead in power systems decarbonisation, but tconcludes to lag on clean electrification. Policies to incentivise electricity demand are therefore key. Data centres are a visible and politically sensitive source of demand, but sustained growth will come from electrifying the vehicle fleet and building stock.
Made in Europe?
A final question concerns the technologies themselves: wind turbines, solar panels, batteries, electric vehicles and the grid infrastructure that connects them. Here, Europe faces a familiar trade-off.
Genuine security risks tconclude to lie more in software and digital systems than in physical hardware
Chinese manufacturing often offers significantly lower costs, but relying heavily on imports raises concerns — real or perceived — about industrial competitiveness and energy security. And this comes against a backdrop of increasing acquire-local criteria in government-led auctions.
The sensible path lies somewhere in the middle. Genuine security risks tconclude to lie more in software and digital systems than in physical hardware. Strong standards for software and control systems can mitigate those risks, while allowing lower-cost hardware — whether Chinese or European — to reduce system costs.
At the same time, Europe should focus on strengthening its own industrial base, not by excluding cheaper imports but by encouraging manufacturing within Europe through joint ventures and investment. Batteries, electric vehicles and wind technology all offer opportunities, while European companies retain strong capabilities in areas such as grid equipment and power system integration.
Building a clean energy powerhoapply
In a fractured geopolitical landscape, Europe faces pressure from both China’s emerging electrostate economy and traditional petrostates. The decision by North Sea countries to pursue 100GW of offshore wind reflects a strategic attempt to escape the volatility of fossil fuel markets.
As European energy ministers put it, the goal is to transform the North Sea into a clean-energy powerhoapply that is “homegrown, secure and affordable”.
Achieving that vision will require more than wind farms alone. But a strategy built on renewables, expanding electrification and pragmatic supply chains offers Europe its most resilient, and ultimately most affordable, energy future.
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