The UK government has increased the maximum price for tidal energy projects by 29%.
The government has raised the maximum price offshore wind and other renewables projects can receive in the next CFD auction to ensure it is performing effectively.
The CFD scheme ensures that the government provides a fixed price for the renewable energy projects. The country is already hosting the world’s 5 largest operational offshore wind farm projects. Renewable electricity generation increasing from 6% in the first quarter of 2010 to 48% in the first quarter of this year.
The maximum bid price for tidal energy projects has been increased from £202/MWh to £261/MWh. It will offer certainty for developers, according to the UK government.
We will also allocate a separate funding pot for offshore wind, recognizing the high number of projects ready to participate. This allocation will ensure healthy competition among a robust pipeline of projects, helping the UK achieve its ambition of up to 50GW of offshore wind by 2030.
In the 2025 auction, projects may secure extra funding by reducing carbon emissions in their supply chains. Additionally, they are required to demonstrate a positive social impact on communities.
The government is also unveiling developed proposals to assess applications in the 2025 auction. Evaluation will not solely be based on their ability to provide low-cost energy. Also on how much a project contributes to the environmental sustainability of the industry. The assessment will also consider the social impact of a project, including the impact of supply chains on jobs and communities.
This will contribute to ensuring that projects have sustainable and economically viable pricing to compete in AR6. These auctions have, so far, granted contracts totaling around 30GW of new renewable capacity across all technologies since 2014.
In AR6, offshore wind will also be given a separate funding pot in recognition of the high number of projects ready to participate. This will ensure healthy competition among a strong pipeline of projects. This help the UK deliver on its ambition of up to 50GW of offshore wind by 2030.