The government has confirmed there will be another round of the Contracts for Difference (CfD) auction for renewable energy, ahead of today’s expected publication of the Clean Growth Strategy.
The energy minister Richard Harrington said up to £557m will be made available under the next CfD round, which will take place in spring 2019.
Last month, the government revealed the winners of the current CfD auction round, which saw three offshore wind farms clear a strike price of just £58/MWh from 2022-23 for renewable electricity.
‘We’ve shown beyond doubt that renewable energy projects are an effective way to cut our emissions, while creating thousands of good jobs and attracting billions of pounds worth of investment,’ said Mr Harrington.
The last round of CfD was controversial for some people in the renewables sector because onshore wind and solar was unable to compete.
The chief executive of the Solar Trade Association, Paul Barwell, said the announcement of a further CfD round was ‘good news for clean energy’, but added ‘we are still missing any positive news for the UK solar industry as it continues to be shut out of the auctions market’.
‘Recent wind prices are good, but consumers will benefit from even lower prices and faster decarbonisation when the government provides a level playing field that enables solar power to compete for long-term CfD contracts,’ said Mr Barwell.
‘We hope the Clean Growth Strategy will move to level the playing field for solar power,’ he added.
While the Renewable Energy Association’s head of policy and external affairs, James Court, said: ‘The last auction showed what government support and consistency can do for an industry, with offshore wind showing incredible cost reductions.
‘Yet we still find ourselves in a situation where the government will support new nuclear, new gas, new diesel, yet won’t support the most cost effective technologies such as solar, onshore wind and biomass, which are still blocked to market,’ added Mr Court.
‘The energy market is changing rapidly, with cheaper renewables, a more de-centralised grid, smart meters and battery storage driving this revolution. Yet the UK will be left behind globally if the government don’t start supporting the industry and we will be left with a higher cost, higher carbon and out of date system that we will all end up paying for.’
And Scottish Renewables chief executive, Claire Mack, said the announcement ‘some useful clarity on the timing of the next round of auctions’.
‘If we are to meet our climate change targets at lowest cost, government must also give certainty to the cheapest forms of new power generation – onshore wind and solar – which have been excluded from competing in auctions for power contracts for more than two years,’ added Ms Mack.
‘Newer technologies which hold huge potential to capitalise on the UK’s vast wave and tidal resource also need a meaningful route to market which allows companies in that sector to move along the critical path towards full commercialisation.
‘As well as encouraging a diverse mix of renewable technologies to play a full role in our energy mix, we hope to see further clarity in the Clean Growth Strategy on how the government intends to make much faster advances in cutting carbon from heat and transport – crucial to meeting our global climate obligations,’ she added.