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48 days ago

UK TO "ALLOCATE £800M FOR OFFSHORE WIND AR6 BUDGET"

Industry News

The UK will offer £800m to support the development of offshore wind in its upcoming AR6 budget.

The UK government has confirmed the budget for the sixth Allocation Round (AR6), including more than £800 million for offshore wind projects.

This represents a support package three times bigger than previous ones.

The UK’s last Contracts for Difference (CfD) auction failed to attract any bids from offshore wind developers over concerns that the prices offered, capped at £44, were too low.

With increased auction support, the UK will be able to offer higher prices to developers, which have been beset by rising costs and interest rates.

The upcoming allocation AR6 will offer a price ceiling of £73 per megawatt-hour after Energy Secretary Claire Coutinho and her officials increased administrative strike prices last year. 

Coutinho said: “When it comes to renewables, we have a record to be proud of. In 2010, just 7% of our electricity came from renewables, this is now up to over 40% today.

“We have the second largest renewables capacity in Europe, which is backed by £300 billion of investment since 2010, with £24bn since September alone.

“We are sticking to the plan to deliver the long-term change our country needs to deliver a brighter future for Britain – securing more homegrown, green energy we can protect billpayers from volatile gas prices.”

The next Contracts for Difference (CfD) auction will open for bids from developers on March 27, with renewable energy types grouped into three pots.

The total budget for AR6 will include just over £1 billion in funding from each financial year from 2027/28 to 2029/30, plus an additional £905 million in 2030/31.

For further information about the projects that are eligible to bid into AR6, please reach out to our sales team here who would be happy to provide further insight! 

 

 

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