U.K.’s offshore wind farms help generate record Royal budget
The U.K.’s world-leading investment in offshore wind farms has contributed toward a record government grant to the Royal Family in 2018.
The Royal Family receives its annual Sovereign Grant from the British government.
The payment is currently equivalent to 25 per cent of the profits of the Crown Estate. The rate has been temporarily increased from 15 per cent to help with the refurbishment of Buckingham Palace.
The Crown Estate is a huge real estate portfolio, historically owned by the monarch, but now run by a corporation for the benefit of the British taxpayer.
In 2018, the royal grant from the U.K. Treasury worked out to $137 million.
The portfolio saw relatively weak growth in the property market in 2018, but it reached a record profit, partly because the Estate manages much of the seabed around the coast of the U.K.
“One of the Godsends of the Crown Estate is that they happen to own most of the coastline of the United Kingdom, and the seabed up to 12 miles out from the coast,” said Royal finance expert David McClure.
“What they do with that land is they lease it out to energy companies. They, in turn, build wind farms.”
The Crown’s seabed generated 7.7 gigawatts (GW) in 2018, up 0.2 GW from 2017.
The U.K.’s geography as an island nation in the northeast Atlantic Ocean is part of the reason it generates more power from offshore wind turbines than any country in the world.
The other reason is policy. The British government recently agreed to a deal with the industry to provide even more of the nation’s power.
“We’ve set out that by 2030, offshore wind is going to be providing at least a third of the UK’s entire power needs,” said Luke Clark from the industry body Renewable UK.
“That’s really going to put offshore wind at the backbone of the U.K.’s clean energy future.”
Offshore wind energy projects have proved controversial and political in many countries, including Canada; but Britain has invested heavily in the technology for decades.
Clark says the size of the wind turbine production industry is key to its success in the U.K.
“We have spent nearly 20 years now developing these offshore wind farms and people have seen the positive impact they’ve had,” he said.
“There is a lot of public trust and public support for offshore wind.”
Last year saw the completion of the world’s largest wind farm off the northwest coast of England.
Walney Wind Farm generates enough electricity for 600,000 homes.
One rotation of a Walney turbine produces enough electricity to power an average home for 29 hours.
“The turbines that we’re installing now have a tip height of about 220 metres. That makes them taller than, or as tall as, the biggest skyscrapers that you see in the London skyline,” said Clark.
The Sovereign Grant will likely continue to rise as more offshore turbines get installed, but its size is set to be reduced from 25 per cent to 15 per cent of the profits of the Crown Estate after Buckingham Palace renovations are completed in 2027.
In June 2019, the U.K. government made a commitment for the country be a net-zero emitter of greenhouse gases by 2050.
The Scottish government has committed to reach that target by 2045.
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