United Kingdom

United Kingdom

UK offshore wind to compete in own CfD tender round

The UK government hopes to award contracts to 12GW of renewable energy capacity in the next auction rounds, which are scheduled for late 2021

The UK has 11.8GW of operational offshore wind capacity, including the ScottishPower Renewables-developed 714MW East Anglia One
The UK has 11.8GW of operational offshore wind capacity, including the ScottishPower Renewables-developed 714MW East Anglia One

Fixed-bottom offshore wind will have a pot to itself in the UK’s next contracts for difference (CfD) tender rounds next year rather than compete against other renewable energy technologies, the government has announced.

The technology had dominated earlier auction rounds, taking the vast majority of capacity awarded, with prices being cut by two thirds between 2015 and 2019.

Meanwhile, floating offshore wind projects will be able to bid for contracts for the first time. It will compete against “less-established technologies”, such as advanced conversion technologies and tidal stream.

And solar and onshore wind projects will be able to compete for the first time since the initial CfD tender in 2015. They will be up against other "established technologies", including hydro and energy from waste with combined heat and power (CHP).

The government hopes to contract more than double the capacity of renewable energy than in the last tender round in 2019 –  12GW compared with 5.9GW previously. It has held CfD tenders every other year since 2015.

How the 12GW is to be split between the different technology groups is yet to be revealed. Offshore wind projects built in phases will be capped at 1.5GW, however.

Energy minister Kwasi Kwarteng said: “The UK is a world leader in clean energy, with over a third of our electricity now coming from renewables. That huge achievement is thanks to the government’s contracts for difference scheme.”

The government recently unveiled a ten-point plan for a green industrial revolution, and reaffirmed the 40GW by 2030 offshore wind target the ruling Conservative party had outlined in its 2019 election manifesto.

It has today reiterated a commitment to update its guidance for new onshore wind schemes in England to “fully reflect the impacts and benefits to local communities”

It has also launched a consultation on new proposals for a supply chain plan. It aims to introduce new measures to ensure developers maintain their supply chain commitments.

UK lobbying group RenewableUK welcomed the newly unveiled details for the next CfD round, which is due to take place in late 2021.

Chief executive Hugh McNeal said that a dedicated pot for offshore wind should help it develop the scale needed to meet the 40GW target, and described onshore wind’s reintroduction to the scheme as an ‘important step to ramp-up investment in this key technology.

The UK has 13.6GW of operational onshore wind capacity and 11.8GW of operational offshore wind capacity, according to Windpower Intelligence, the research and data division of Windpower Monthly.

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