A NEW Contracts for Difference auction will allow cheap renewable sources like onshore wind and solar to compete for contracts which enable new projects to be financed – the first such auction since 2015.
Details of the new round of the Contracts for Difference scheme, which opens in 2021, have been set out today, Monday 2 March.
The scheme will also be changed to facilitate the deployment of energy storage, with proposals also to include floating offshore wind.
Secretary of State for Business and Energy Alok Sharma commented the announcement: “Ending our contribution to climate change means making the UK a world leader in renewable energy.
“We are determined to do that in a way that works for everyone, listening to local communities and giving them an effective voice in decisions that affect them.”
Local communities will have a more effective voice on developments through proposals for ‘tough new guidance’ on community engagement for developers of onshore wind across Great Britain where they will have a definitive say on whether projects are allowed to proceed.
English onshore wind projects still cannot proceed without the consent of the local community.
RenewableUK’s Chief Executive Hugh McNeal added: “The government is pressing ahead with action to meet our net zero emissions target quickly and at lowest cost to consumers and businesses.
“Backing cheap renewables is a clear example of the practical action to tackle climate change that the public is demanding, and this will speed up the transition to a net zero economy.”
Today’s consultation outlines proposals to ensure the Contracts for Difference scheme can support the increased ambition required, including:
- Making the UK a world-leader in new technologies such as floating offshore wind, which would allow wind farms to be built further away from the shore and increase clean energy capacity
- Supporting the renewables supply chain to enhance productivity and increase competitiveness, boosting the UK’s world-class clean energy industry
- Improving the scheme to better support energy storage, so projects can provide power when the wind stops blowing or the sun is not shining
Chris Hewett, Chief Executive of the Solar Trade Association, commented the news: “Today’s announcement marks a major shift in the right direction for Government policy on onshore renewables, and a welcome opportunity for the solar industry.
“New clean power auctions for Pot 1 technologies will accelerate the decarbonisation of the power sector and drive the shift towards net zero, bringing with it new jobs, cheaper electricity and opportunities closer to home for Britain’s highly experienced solar investors.
“The Government is backing a winner in solar, which is not only the UK’s most popular energy technology but also highly cost-effective and one which offers unique opportunities to enhance local biodiversity and agriculture.”
Today’s consultation also invites views on the structure of the next Contracts for Difference allocation round.
The consultation is available here
The consultation closes on 22 May 2020.