Government confirms £290m contract for difference auction to start in April


Greater Gabbard wind farmGovernment has confirmed that the next contract for difference (CfD) auction to support renewable and low carbon generation will commence next April. It has set a budget of £290m, although left wriggle room to adjust that amount closer to the auction.

The Department of Business, Energy and Industrial Strategy said contracts will be allocated to the cheapest projects first, regardless of their start date, as long as they fit within the budget profile provided and are delivered 2021/22 – 2022/23.

Price support for offshore wind will be reduced to £105MWh. Fuelled technologies such as biomass, energy from waste and anaerobic digestion will receive between £115 and £140MWh up to a cumulative project cap for fuelled technologies of 150MW, although BEIS said that cap was temporary to give it time to consider whether CFD support for such technologies is appropriate. It has launched a call for evidence on fuelled technologies as well as geothermalcfd

Wave and tidal projects can also bid for support (£310MWh and £300MWh), although the paperwork suggests they may not fare well against cheaper technologies in a reverse auction environment.

All strike prices bar dedicated biomass with CHP drop slightly for projects that start generating in 2022/23.

Government has not yet made a decision on whether to support onshore wind outside mainland UK. It is seeking views via consultation.

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