United Kingdom

United Kingdom

UK sets out CfD auction plan from 2019

UK: The government will hold its next contracts for difference (CfD) auction in May 2019 and further biennial tenders through the 2020s, it has announced.

The 630MW London Array is currently the UK's largest offshore wind farm
The 630MW London Array is currently the UK's largest offshore wind farm

Energy minister Claire Perry announced the UK’s next CfD auction during a visit to the Offshore Renewable Energy Catapult (ORE Catapult) centre in Blyth today, according to the Department for Business, Energy and Industrial Strategy (BEIS).

Projects on remote islands will also be eligible to take place in the next wave of CfD auctions, following a consultation launched in December, BEIS confirmed.

The next CfD tender will be held in May 2019, a subsequent allocation round in 2021, and further auctions "around every two years", the government stated.

The total budget for each tender has not yet been confirmed. Energy minister Perry said the government "plans to set out the parameters of the auctions later this year".

However, the government added that "depending on the price achieved, these auctions will deliver between 1GW and 2GW of offshore wind each year in the 2020s". It did not mention an expectation for the combined capacity of wind farms on remote islands.

Up to £557 million (€663 million) in 2011/12 prices has been made available for further CfD tenders by 2020.

In the latest round, in September 2017, two offshore wind projects were awarded CfD deals at £57.50/MWh (€64.10/MWh) – a 50% cost reduction from contracts awarded 30 months earlier.

On a visit to the ORE Catapult centre in Blyth, energy and clean growth minister Claire Perry, said: "For the last decade, the offshore wind industry has been a great British success story: increasing productivity, raising earnings and improving lives in communities across the UK, and today the sector gets the certainty it needs to build on this success through the next ten years."

According to Windpower Intelligence, the research and data division of Windpower Monthly, the UK leads the world, with just over 7.1GW of offshore wind capacity installed in its waters.

Lobbying organisation RenewableUK welcomed the government’s announcement, pointing out that the expected additional capacity would more than double this amount.

Its chief executive Hugh McNeal said the announcement was "a ringing endorsement" for the industry.

BEIS also announce £73 million in funding over the next five years for ORE Catapult’s innovation and research centre in Blyth in the north-east of England today. 

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