"We never envisaged or indeed wanted, every project to succeed," Davey said.
His comments come after a difficult year for offshore. Although the UK has around 4GW of installed capacity, projects worth more than double that have been cancelled over the last year. This include the 4GW Celtic Array and 1.5GW Argyll Array.
Davey said the budget set for the contracts for difference subsidy programme will create a focus on costs and will drive competition, adding some projects were bound to fail. He said there had to be a limit for tax payer support for low carbon industries.
"For some in the industry, that early introduction of competition has been scary. Newspapers may write about offshore wind projects being dropped as if something is going wrong," he said.
The annual budget had been criticised for being too low by many in the industry, including RenewableUK. The body said the £235 million (EUR 297 million) to be used to subsidise less established technologies, such as offshore wind, would only support up to 800MW of new capacity each year.
The energy secretary also made several announcements at the conference. He revealed MHI-Vestas' plans to invest £200 million into the UK and to set up a blade manufacturing facility on the Isle of Wight by leasing Vestas' facility.
Davey also publicised the findings of a review, commissioned by the Offshore Wind Industry Council, into the UK offshore supply chain. It called for the need for greater transparency in the order pipeline and more collaboration in the sector.