July 24 (Renewables Now) - The UK government announced plans to hold Contracts for Difference (CfD) auctions for offshore wind and other "less established" technologies every two years and said the first one is expected to take place by May 2019.
As previously confirmed, the next auction will be for up to GBP 557 million (USD 730m/EUR 625m) of annual support.
The idea is to deliver 1 GW to 2 GW of offshore wind capacity each year in the 2020s, according to an official announcement.
For the first time, remote island onshore wind projects will also be able to bid for contracts. The government decided to allow this in December 2017 after determining that such projects have significantly higher transmission costs but also higher load factors.
The second CfD auction in 2017 awarded contracts to 3.3 GW of renewables, with the clearing price for offshore wind halving to GBP 57.50 per MWh compared to the first auction held in 2015.
“We have proposed a transformative ambition to deliver at least 30 GW by 2030, enough to meet more than a third of the country’s electricity needs, which in turn, together with the pipeline of regular auctions announced today, could increase exports five-fold, create thousands of skilled jobs and reduce electricity system costs,” stated Benj Sykes, Co-Chair of the Offshore Wind Industry Council and UK Country Manager at Ørsted.
Also on Monday, the government announced that the Offshore Renewable Energy Catapult in Blyth and the Centre for Process Innovation in Redcar, part of the High Value Manufacturing Catapult, will get a cash injection in the form of five-year funding to back hundreds more businesses. More centres will get support as well.
(GBP 1.0 = USD 1.312/EUR 1.122)