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RenewablesUK voice CfD comments

By: Lewis Holdsworth 26/02/2015 RenewableUK

General Windfarms

RenewableUK today commented on the results of the first auctions for renewable power held under the Contract for Difference regime. RenewableUK Chief Executive Maria McCaffery said: “We are pleased to see these projects, which between them could power over 1.2 million homes, and create substantial numbers of jobs, and much needed investment in our communities, moving forward."

The regime, instituted by the 2013 Energy Act, gives renewable power developers contracts detailing a set amount – or “strike price” for each megawatt hour (MWh) of power they produce. Developers are given a guarantee that they will receive this price for each megawatt hour for fifteen years of operation.

Contracts were awarded to two offshore wind farms, one in England and one in Scotland: East Anglia Phase 1, and Neart na Gaoithe, a total of 1162 MW capacity, with strike prices varying between £114.39 and £119.89 per MWh. Contracts were also awarded to fifteen onshore wind farms, across England, Scotland and Wales. The onshore wind farms awarded contracts equated to a total of 748.55 MW capacity, with average strike prices for each year varying between £79.23 per MWh and £82.50 per MWh.

Maria Caffery adds "The highly competitive prices achieved during this Auction, highlight the fact that the industry has been working hard to bring costs down, both onshore and offshore. The prices achieved by the onshore industry show what utter folly it would be to choke off this low cost form of low carbon power and the results also demonstrate that the offshore industry, provided the conditions are maintained, is well on the path to achieving its stated aim of £100/MWh by 2020.

However, there remains a lot of work to be done to ensure that developers remain committed to the UK market, bringing forward much needed power, and economic benefits."

The next round of auctions is due to take place in the autumn of 2015, and Ms McCaffery warned that all political parties aiming to be in Government needed to consider how these should function. “It is vital that the new Government moves quickly to clarify process around the next awards. A level of certainty about both immediate future allocation rounds, but also the long term vision of decarbonised electricity, and the support needed for it, will ensure projects keep coming forward, at the right price. The industry has really extended itself today on the cost reduction agenda, and Government needs to respond positively with a clear signal about future rounds and long term support, to enable the continued development of low carbon power at a good price”

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RenewablesUK voice CfD comments

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