Britain’s next auction round of clean power generation under five-year CfD support will open for bids in December, the government has announced. In a supposed Brexit bonus, winning generators seeking to keep their subsidies must source more kit from British suppliers.
Among reforms to the CfD regime, the ministry confirmed on Friday that developers of projects bigger than 300MW will now be assessed on their supply chain plans shortly after a project’s ‘milestone delivery’ date. Previously, procurement checks have only been conducted after green energy farms are commissioned.
Developers will also face subsidies being withdrawn if their ‘supply chain implementation’ strategies fail to find favour with the Secretary of State. The minister will get new powers, authorising him to pass or reject a ‘supply chain implementation’ report on projects.
The latest changes follow a two-month consultation from January on the CfD bidding process, which attracted 52 responses. “Driving regional growth” features in the proposals among government priorities for more home-sourcing of materials and infrastructure.
Also confirmed in Friday’s announcement is the government’s decision to cut coal-to-biomass conversions out of CfD allocation rounds after December. Existing CfD contracts will be also be changed, blocking difference payments being paid to generators when market prices for power turn negative, such as in periods of weak demand or excess generation.
A further change in the AR4 awards will be the extension to 18 months of so-called ‘milestone delivery’ dates, achieved when developers can prove they’ve committed at least one-tenth of a project’s pre-commissioning spend.
In the last CfD round in 2019, offshore wind totalling almost 5.5GW in capacity secured funding. Generation prices were stabilised under AR3 contracts at between £39.65 and £41.61 per MWh.
Full details on D-Beis’ latest CfD criteria here.
