UK raises budget for ongoing CfD auction by GBP 22m
Solar park in Somerset, England. Image by: Elgin Energy.
The UK Energy Security Secretary on Thursday announced a GBP-22-million (USD 28.1m/EUR 25.6m) increase in the budget for the ongoing fifth round of the Contracts for Difference (CfD) scheme, bringing the overall budget for the auction to GBP 227 million.
The funding available for established technologies such as solar and offshore wind is being increased by GBP 20 million to GBP 190 million, while the budget for emerging technologies such as floating wind is going up by GBP 2 million to GBP 37 million. Within the emerging technologies pot, a GBP-10-million ring-fenced budget is being maintained for tidal stream projects.
The CfD auctions are the government’s flagship renewables support scheme. The budget for the fifth round was initially announced in March. Round 5, which is the first annual edition of the scheme, opened to applications at the end of March and closed in April.
The government expects the increased funding combined with the introduction of annual auctions to boost investments in the country’s renewable industry. Energy Security Secretary Grant Shapps said that this, “alongside our backing for oil and gas, carbon capture and our revival in nuclear, will ensure we can help power more of Britain from Britain for decades to come.”
Industry group RenewableUK welcomed the budget uplift. Its executive director of policy Ana Musat also urged the government to ensure sustainable pricing in future auctions, given the difficult economic circumstances faced by the sector. “Setting artificially low prices will deter investment, reduce our pipeline and limit the UK’s ability to stay ahead in the global race for renewable energy capital, skills and supply chain investment," added Musat.
The government said the news comes as Deputy Prime Minister Oliver Dowden visits Able Seaton Port to announce the installation of the first of 277 turbines at Dogger Bank, which will become the world’s largest offshore wind farm. The project is being built by SSE Renewables, Equinor and Vargronn.