The fees charged by the Crown Estate for offshore wind farm developers to access the seabed could increase household energy bills by up to £38 annually, according to research from a team at the University of Oxford. The Crown Estate, a public corporation responsible for managing certain royal properties and land, including seabed rights, leases these rights to wind energy projects, generating significant revenue that flows to the Treasury and, indirectly, the monarchy through the sovereign grant.

Five years ago, the Crown Estate altered its fee structure for wind farm developers, moving from capped “option fees” to an auction-based system. Economists at Oxford found this change increased borrowing costs for renewable energy companies, which may be passed on to consumers in the form of higher energy bills. While wind farm payments to the Crown Estate were £875 million last year—a decline from a peak of more than £1 billion the previous year—the team estimated that the ongoing fee regime could cumulatively add between £326 and £659 to household energy bills over the next two decades.

Cameron Hepburn, professor of environmental economics at the Smith School of Enterprise and the Environment and one of the study’s authors, highlighted that the shift effectively raises costs for developers and leads to a significant transfer of funds to the Crown Estate and Treasury at a time when energy affordability is a major public concern. The study projects cumulative impacts on energy bills to reach between £19 and £38 by 2035 before slightly declining to between £14 and £29 by 2054.

Environmental group Greenpeace has criticized the Crown Estate's monopoly over seabed leasing and has threatened legal action, accusing the corporation of exploiting its dominant position. This comes amid the UK government’s goal to quadruple offshore wind capacity by 2030 as part of broader efforts to achieve net zero carbon emissions by 2050.

Hepburn warned that the high access fees carry the risk of discouraging investment in offshore wind projects, potentially hindering the UK’s ability to meet its renewable energy targets. He pointed to recent developments such as BP and partners returning their seabed rights for a wind farm in the Irish Sea, suggesting that the financial burden under current arrangements may be causing some projects to be abandoned. Hepburn also suggested that the government could instruct the Crown Estate to revert to a capped fee system to alleviate these pressures.

The Crown Estate defended its leasing approach, stating it has evolved alongside market conditions. The auction system introduced in “Round 4” in 2021 reflected contemporary market realities, and the upcoming “Round 6” is expected to implement a commercial model tailored for the growth phase of the offshore wind sector. The government has yet to comment on the findings or the concerns raised.