The latest auction for Contracts for Difference (CfD)to generate clean power has secured the largest ever amount of renewable energy at record low prices.

10.8GW of new onshore and offshore wind, solar, tidal stream and other renewables will go ahead as a result of the announcement by the Department for Business, Energy and Industrial Strategy of the winning bidders in CfD Allocation Round 4. This secures far more capacity than any of the previous three auction rounds, and nearly as much as the three previous rounds combined (11.26GW).

10.8GW represents 14 per of the UK’s total current electricity capacity (75.8GW) as the UK, amongst other countries, seeks to create greater energy independence.

Nearly two-thirds of this will be new offshore wind as five projects secured 7GW of new capacity, demonstrating that this technology is central to the UK’s transition to clean power. The cost of offshore projects remained low in this auction with strike prices of just £37.35 per MWh – the lowest cost of all renewable technologies, and significantly cheaper than the current cost of electricity, which has been trading at over £150 per MWh for much of this year.

Onshore wind competed in the auction for the first time since 2015, after a long-running campaign by RenewableUK to end its exclusion from the competitive process. This technology proved yet again that it is one of the cheapest ways to generate new power, with strike prices at £42.47.

RenewableUK’s deputy chief executive Melanie Onn said: “The cost-of-living crisis and the war in Ukraine have pushed affordability and energy security to the top of everyone’s agenda, with billpayers desperate for relief from fossil fuel price hikes. Today’s record-breaking auction results show that there is a way to replace unaffordable gas with low-cost clean power generated by a wide range of renewable technologies led by wind, both offshore and onshore. Thanks to the rapid construction times of renewables, billpayers will start to feel the benefits of today’s auction next year.”

Share Story: