Renewable energy is often pitched as cheaper to produce than fossil fuel energy. To quantify whether this is true, we have been studying the financial impact of expanding wind energy in the UK. Our results are surprising.
From 2010 to 2023, wind power delivered a benefit of £147.5 billion — £14.2 billion from lower electricity prices and £133.3 billion from reduced natural gas prices. If we offset the £43.2 billion in wind energy subsidies, UK consumers saved £104.3 billion compared with what their energy bills would have been without investment in wind generation.
UK wind energy production has transformed over the past 15 years. In 2010, more than 75% of electricity was generated from fossil fuels. By 2025, coal has ceased and wind is the largest source of power at 30% – more than natural gas at 26%.
This massive expansion of UK offshore wind is partly due to UK government subsidies. The Contracts for Difference scheme provides a guaranteed price for electricity generated, so when the price drops below this level, electricity producers still get the same amount of money.
The expansion is also partly due to how well UK conditions suit offshore wind. The North Sea provides both ample winds and relatively shallow waters that make installation more accessible.
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The positive contribution of wind power to reducing the UK’s carbon footprint is well known. According to Christopher Vogel, a professor of engineering who specialises in offshore renewables at the University of Oxford, wind turbines in the UK recoup the energy used in their manufacture, transport and installation within 12-to-24 months, and they can generate electricity for 20-to-25 years. The financial benefits of wind power have largely been overlooked though, until now.
Our study explores the economics of wind in the energy system. We take a long-term modelling approach and consider what would happen if the UK had continued to invest in gas instead of wind generation. In this scenario, the result is a significant increased demand for gas and therefore higher prices. Unlike previous short-term modelling studies, this approach highlights the longer-term financial benefit that wind has delivered to the UK consumer.
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Central to this study is the assumption that without the additional wind energy, the UK would have needed new gas capacity. This alternative scenario of gas rather than wind generation in Europe implies an annual, ongoing increase in UK demand for gas larger than the reduction in Russian pipeline gas that caused the energy crisis of 2022.
Given the significant increase in the cost of natural gas, we calculate the UK would have paid an extra £133.3 billion for energy between 2010 and 2023.
There was also a direct financial benefit from wind generation in lower electricity prices – about £14.2 billion. This combined saving is far larger than the total wind subsidies in that period of £43.2 billion, amounting to a net benefit to UK consumers of £104.3 billion.
Wind power is a public good
Wind generators reduce market prices, creating value for others while limiting their own profitability. This is the mirror image of industries with negative environmental consequences, such as tobacco and sugar, where the industry does not pay for the increased associated healthcare costs.
This means that the profitability of wind generators is a flawed measure of the financial value of the sector to the UK. The payments via the UK government are not subsidies creating an industry with excess profits, or one creating a financial drain. They are investments facilitating cheaper energy for UK consumers.
Wind power should be viewed as a public good — like roads or schools — where government support leads to national gains. The current funding model makes electricity users bear the cost while gas users benefit. This huge subsidy to gas consumers raises fairness concerns.
Wind investment has significantly lowered fossil fuel prices, underscoring the need for a strategic, equitable energy policy that aligns with long-term national interests. Reframing UK government support as a high-return national investment rather than a subsidy would be more accurate and effective.
Sustainability, security and affordability do not need to be in conflict. Wind energy is essential for energy security and climate goals – plus it makes over £100 billion of financial sense.
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