The UK builds most of its new offshore wind through Contracts for Difference, the auction mechanism that gives developers a guaranteed price for the power they generate over a long-term contract, in exchange for competing to offer that power as cheaply as possible. It has become the single most important lever the country has for adding offshore capacity. But the mechanism carries a lesson that is easy to overlook: a guaranteed price is not the same as guaranteed revenue, and the gap between the two is a forecasting problem.
What the auctions have already taught us
The clearest illustration came in 2023, when the fifth allocation round attracted no offshore wind bids at all. Costs for turbines, cables, vessels and financing had risen sharply, while the maximum price on offer had been set before that inflation took hold. Developers concluded the numbers did not work, and they stayed away. It was a stark reminder that an auction only functions when the price on offer reflects what it genuinely costs to build.
The following round, in 2024, corrected course with a substantially larger budget and secured roughly 5 GW of new offshore wind. The episode set the pattern for everything since: each round succeeds or fails on whether developers believe the guaranteed price will cover their costs and deliver a return,and that belief rests on how confident they are in the amount of electricity a project will actually produce.
That question is not abstract. The government's Clean Power 2030 Action Plan targets 43 to 50 GW of offshore wind by 2030, including around 5 GW of floating capacity, with roughly 30 GW already installed or committed against that range. Closing the remaining gap depends on a steady pipeline of projects reaching final investment decisions, and each of those decisions turns on the strength of the yield estimate underneath it.
A fixed price, a variable resource
A Contract for Difference fixes the price per megawatt-hour. It does not fix how many megawatt-hours a wind farm will generate, or when. That depends entirely on the wind, how hard it blows, at what height, across which hours and seasons, over a contract that can run for fifteen years.
For a developer, that uncertainty sits at the centre of the business case. Overestimate the resource and the project's returns can evaporate, underestimate it and the bid may not be competitive enough to win in the first place. For the grid operator, the same uncertainty appears as a balancing challenge: offshore generation that arrives in unexpected volumes at unexpected times is harder and more costly to integrate. As more capacity comes online, the cost of getting those forecasts wrong grows with it.
This is why a favourable auction price, on its own, is never enough. The value of an offshore project is only as bankable as the yield estimate behind it, and that yield estimate is only as good as the wind data it is built on.
Turning a plausible site into a financeable asset
Modern offshore turbines stand far taller than the machines that defined the first wave of UK offshore wind, and wind behaves differently at those hub heights than it does nearer the surface. Characterising the resource accurately, across the full rotor, over long historical records, and out across the forecast horizons that matter for both trading and day-to-day operations, is what turns a site from a plausible location into a financeable asset.
OpenWeather's Wind Forecast Service is built for this. By providing high-resolution wind data at turbine-relevant heights, it helps developers sharpen energy-yield predictions before a bid is submitted, gives asset owners a clearer picture of expected output across the life of a contract, and supports the short-term forecasting that operators rely on to schedule and dispatch generation with confidence. In an auction where the margin between a winning bid and an unviable one is measured in a few pounds per megawatt-hour, forecast accuracy is not a technical detail, it is part of the commercial case.
The resource decides the return
The auction mechanism sets the price, but it is the wind that sets the output, and the output that sets the return. Converting the country's offshore ambitions into turbines in the water – and turbines in the water into predictable, dispatchable power – depends on the quality of the wind intelligence underpinning every stage, from the yield model in the bid to the dispatch decision years later. For anyone weighing an offshore project, the decisive question is not only whether the price is high enough. It is whether they can forecast the wind well enough to make it count.