Floating windfarm to sink backers?

A megawatt of gas-fired power station comes with a capital cost of perhaps £0.6 million. You can run such a power station flat out - upwards of 90% of the time - giving you very cheap electricity.

But of course that's not what the political establishment has done. Instead, successive governments have promoted renewables. Onshore windfarm capacity is three times the price, and they only run 30% of the time, at best.

As if that wasn't bad enough, the political establishment has gone for offshore wind too. This is about 5-6 times the capital cost of gas turbines, although the stronger winds at sea mean that they run on average over 40% of the time.

It's true that windfarms don't need fuel, of course, but they also necessitate expensive interventions to balance the grid, and they also mean that gas turbines can no longer run flat out, making them much less efficient.

That's bad, but the political establishment clearly feels that it's a case of "not bad enough". The latest wheeze is floating offshore windfarms, an example of which is the Kincardine Floating Windfarm, the largest such in the world, which has just announced its annual results.

It's fair to say that things are not going well. With a capacity of 50 MW, the windfarm is tiny, but when it was first announced it came with an astonishing price tag of £250 million, making its capacity eight times the price of gas, while potentially only running half as often.

Unfortunately, the cost has risen further still. First to £350 million, and it is now reported that the management think the final bill could end up at £500 million. That would amount to £10 million per megawatt, or nearly seventeen times what a megawatt of gas capacity would cost.

Only those inside the political bubble could think this was a good idea.

Still, if it's any comfort to consumers angry that they will be picking up the bill for this foolishness, it turns out that one of the main backers of the Kincardine Floating Windfarm project is himself a member of the political establishment; the Liberal Democrat peer Nicol Stephen. If he is paying the price for believing his own party's green PR then few will sympathise.