UK Government Backs 5.3GW of Offshore Wind Projects in Latest CfD Auction
September 3, 2024
In the sixth UK’s Contracts for Difference (CfD) allocation round, offshore wind developers have secured support for around 5.3 GW in new capacity for both floating and bottom-fixed offshore wind.
As part of the allocation round 6, nine bottom-fixed offshore wind projects, totaling 4.9 GW, have secured contracts at a cost of £54-59 per megawatt hour (MWh).
The price is in line with other recent auctions globally and reflects the dual impacts of inflation and financing costs due to high interest rates, according to the UK government.
The supported offshore wind farms include the Inch Cape and Moray West in Scotland, as well as East Anglia Two and East Anglia Three, Hornsea 3 and Hornsea 4 in England.
Among the winning projects is Green Volt, which at 400 MW will become the world’s largest floating wind farm – over four times bigger than the largest floating project operating today.
The latest annual auction for CfD to generate clean power has secured 9.6 GW total of new renewable energy capacity for the UK, including support for onshore solar and wind, tidal energy and offshore wind.
The 131 projects which have won contracts in allocation round 6 will power nearly 11 million homes and are expected to attract over $18.3 billion (£14 billion) of new private investment into the economy. The first projects will start generating electricity in 2026.
“Securing new wind turbines, solar panels and cutting-edge technologies such as tidal will boost growth, catalyse investment and support good jobs across Great Britain.
“We’ve done this while ensuring value for money for billpayers, delivering the biggest auction round to date at competitive prices, helping turbocharge our mission for energy independence and clean power by 2030,” said Michael Shanks, Energy Minister.
“The success of today’s auction sends a clear signal that the UK is back in the global race for clean energy investment. This wide range of projects, across technologies, are vital steps in building a clean, affordable energy system and reducing our dependence on expensive fossil fuels.
“After the failure of last year’s offshore wind auction, it was essential that this auction succeeded and the fact that nine major offshore wind projects have secured contracts will increase investor confidence. There is intense global competition in offshore wind and the next auctions will be crucial for the UK,” said Dan McGrail, RenewableUK’s Chief Executive.
