UK government accelerates low-cost renewable energy


United Kingdom – UK government’s flagship renewables program will be accelerated as it ramps up auctions to encourage investment and jobs.

According to the announcement, funding auctions under the CfD scheme will now take place once a year rather than every two years. Renewable energy producers will benefit and the UK’s renewable energy infrastructure will be bolstered as a result. As of March 2023, when the next CfD round opens, the new policy will take effect. CfDs are the government’s primary method of supporting renewable energy, driving down the costs of technologies and facilitating £90 billion of private investment by 2030.

Since the first auctions were held, the auction scheme has already proven successful in reducing the per-unit price of offshore wind by around 65 percent, helping the UK become one of the world’s largest generators of wind power. A total of nearly 6GW of additional capacity was awarded in the most recent round of contract awards. Enough to provide record-low prices for over 7 million homes’ electricity needs while also creating a substantial number of jobs in the UK. Increasing the frequency of auctions will also help to increase the UK’s supply of renewable energy and support the country’s long-term energy security by allowing more projects to enter the system.

New renewable capacity

This announcement comes on the heels of a series of government initiatives to support the UK’s nuclear industry: Included are up to £1.7 billion for the Nuclear Energy Bill, £120 million for the Future Nuclear Enabling Fund, and a £210 million grant for the development of a UK Small Modular Reactors design led by Rolls-Royce, all of which will make it possible for the final investment decision on a large nuclear project in this Parliament.

In the UK, successful CfD bids drive efficiency and secure new renewable generating capacity while also providing taxpayers with value for money. In the most recent round of contract awards, a total of 12 new contracts totaling nearly 6GW of additional capacity were made. Thousands of new jobs could be created in the UK and enough electricity generated to power over 7 million homes at historically low prices.

In the Net Zero Strategy, the government stated that it would review the frequency of CfD auctions in order to speed up the deployment of low-cost, low-carbon electricity generation. As a way to demonstrate the government’s commitment to a fully decarbonized electricity system by 2035, the CfD round frequency has been increased.

These new measures are in addition to the government’s ongoing support for the cost of living, which totals £12 billion for the current fiscal year and the following one. Universal Credit taper rate is reduced, the National Living Wage is raised, alcohol and fuel duties are frozen, and energy bills are given targeted assistance.