Offshore wind more expensive than previously thought: CSIRO

The price hike is a result of the global offshore wind industry experiencing high costs, leading to a number of projects overseas being scaled back or cancelled.

In the "current policies" scenario, the CSIRO calculates floating offshore wind will supply energy at $6533 per kilowatt in 2030.

In the more ambitious "global Net Zero by 2050" scenario, the cost comes down to $4536 per kilowatt by the same year.

This is about $1000 more expensive across both scenarios than in the draft report, released late last year.

In a statement accompanying the report, the CSIRO said wind power was more affected by disruptions to global supply chains than other renewable technologies.

"Wind power is recovering the slowest from global inflationary pressures and cost projections for both onshore and offshore wind have been revised upwards in the next decade."

UOW energy expert Ty Christopher said the relative complexity of wind turbines made the technology more susceptible to inflation than solar, for example.

"It comes down to the number of moving parts you've got in the technology," he said.

"[Wind turbines] are a far more complex piece of kit on an individual basis, and as a result of that, the number of manufacturers globally is far fewer.

"The fewer manufacturers that you have globally, the more you're impacted by massive uplift in demand, supply chain delays and cost increases."

Despite this revision, floating offshore wind remains cheaper than nuclear energy, either produced by large reactors or small modular reactors.

Rooftop solar is the cheapest renewable energy technology, while gas is the cheapest technology of those compared by CSIRO.

Being a relatively new technology in Australia, the report warns that offshore wind costs could be significantly higher than projected, due to it being the "first of a kind" technology. Technologies such as nuclear, solar thermal, carbon capture and storage projects could attract a similar premium, the report notes.

The report notes that while the upfront cost of offshore wind may be higher, the capacity factor of the technology - i.e. the amount of time in a day the blades will spin, generating electricity - reduces costs associated with storage, such as the batteries needed for large scale solar farms to provide electricity in the evening, for example.

Mr Christopher said with Australia's current fleet of coal-fired power stations reaching the end of their life and suffering reliability issues, offshore wind would have a similar capacity factor to existing coal power plants in the near future.

"We are five years away from the two of these having almost the same capacity factor."