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Nearly 7 GW of offshore wind awarded in UKs latest CfD auction. Cost falls by 70%.

4C Offshore | Tom Russell
By: Tom Russell 07/07/2022 BEIS

The UK Government has unveiled the winners of the fourth round of the Contracts for Difference (CfD) scheme which has secured 11 GW of future renewable energy generation. Several offshore wind farms with a combined capacity of of nearly 7 GW are among the winning projects.

With an overall budget of £295 million, the fourth round saw £210 million allocated to the pot supporting offshore wind projects, and a further £24 million for floating offshore wind projects. It also saw the per unit (MWh) price of offshore wind secured in this round reach £37.35/MWh, almost 70% less than that secured in the first allocation round in 2015.

The winning projects included the 1080 MW
Inch Cape (Phase 1), 1372 MW EA3 (Phase 1), 1396MW  Norfolk Boreas (Phase 1), 2852 MW and Hornsea Project Three offshore wind farms. Moray West was also successful in securing a CfD for 294 MW. All the aforementioned projects were awarded CfDs at a strike Price of £37.35/MWh with delivery set for 2026/27.

The
TwinHub Floating Offshore Wind Project was also named winner with a strike price of £87.30/MWh for delivery 2026/27. It is the first floating wind farm in the UK to secure a CfD.

Business and Energy Secretary Kwasi Kwarteng said: "Eye-watering gas prices are hitting consumers across Europe. The more cheap, clean power we generate within our own borders, the better protected we will be from volatile gas prices that are pushing up bills.


"Thanks to today’s record renewable energy auction, we have secured almost 11GW of clean, home-grown electricity – which would provide as much power as around 6 gas fired power stations.


"These energy projects already have planning permission, now they have a funding contract in place. We’re going to these projects built as soon as possible to better protect millions of British families from rising costs"


Energy Minister Greg Hands said:"This fourth round shows the government’s Contracts for Difference scheme continues to be a roaring success.


"Not only has it secured a record capacity of clean electricity, it ensures the UK will have a future powered by a resilient and diverse supply of homegrown energy by bringing forward a greater range of renewable technologies than ever before."


Overall, 93 projects with existing planning permission across England, Scotland and Wales have won contracts through the competitive auction process, which is more than in all 3 previous rounds combined.

To remind, CfDs are 15-year private law contracts between renewable electricity generators and the Low Carbon Contracts Company (LCCC), a government-owned company that manages CfDs. They are designed to give greater certainty and stability of revenues to electricity generators by reducing their exposure to volatile wholesale prices, while protecting consumers from paying for higher costs when electricity prices are high.


For more information on offshore wind farms worldwide, click here.

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