CfD delays may put GBP 9bn of Scottish investments on hold

The UK government’s delay of decisions on future Contracts for Difference (CfD) allocation rounds will put on hold investments in Scotland with a total value of about GBP 9 billion (USD 14bn/EUR 12.7bn), Scottish Renewables says.

The Department of Energy and Climate Change (DECC) was supposed to publish information regarding the CfDs for offshore wind and other renewable energy projects by July, but has now postponed the decision until at least the autumn.

"The postponement of this year's auction, and the lack of clarity over future dates and budgets, means the entire industry is totally in the dark about if or when companies will be able to bid for a contract for their power,” Niall Stuart, the CEO of the renewables industry representative body, said in a statement.

The DECC has also proposed some changes necessary “to deal with a projected over-allocation of renewable energy subsidies”. These include a proposal to close the Renewables Obligation (RO) scheme for new solar projects on April 1, 2016, and to remove pre-accreditation for feed-in tariffs (FiT). In June, the government also announced that the RO support regime would close to new onshore wind next year. This move alone is said to threaten as much as GBP 3 billion worth of investment in Scotland.

“There is now so much uncertainty across the whole sector that developers of almost every technology will be hitting the pause button on planned projects,” Stuart noted.

Still, Scottish Renewables’ head welcomed the government’s plan to present details on support for renewables and other forms of clean electricity beyond 2020.

(GBP 1.0 = USD 1.548/EUR 1.411)

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