The UK government has increased the maximum price for tidal energy projects by 29% in its flagship renewables support scheme.
The maximum bid price for tidal energy projects has been increased from £202/MWh to £261/MWh , which will offer certainty for developers, according to the UK government.
Offshore wind has seen the biggest increase in the strike price, from £44/MWh to £73/MWh, corresponding to the price bump of 66%. The price for floating wind has also been increased for 52%, from £116/MWh to £176/MWh ahead of Allocation Round 6 (AR6) next year.
In AR6, offshore wind will also be given a separate funding pot in recognition of the high number of projects ready to participate. This will ensure healthy competition among a strong pipeline of projects, helping the UK deliver on its ambition of up to 50GW of offshore wind by 2030, including up to 5GW of floating offshore wind.
Claire Coutinho , UK Energy Security secretary, said : ”The UK is home to the world’s five largest offshore wind farms projects.
“Today we have started the process of our latest Contracts for Difference (CfD) auction for renewables, opening in March next year. We recognize that there have been global challenges in this sector and our new annual auction allows us to reflect this.
“This is a vital part of our plan to have enough homegrown clean energy, bringing bills down for families and strengthening our energy independence.”
Graham Stuart , minister of state for Energy Security and Net Zero, added: “Last year’s CfD scheme saw more than 90 clean, homegrown energy projects and today we have shown our ongoing commitment to retaining our global leadership in renewable energy.
“This critical update to the scheme’s design provides further clarity and confidence to the offshore wind sector and ensures the scheme remains competitive for renewable developers investing in new low carbon technologies.
“I look forward to securing another year of successful contracts in 2024, creating skilled jobs, reducing emissions and delivering maximum amounts of reliable clean energy for the British public.”
The government is also publishing developed proposals to review applications from the 2025 auction not just on their ability to deliver low-cost renewable energy, but also on how much a project strengthens the environmental and economic sustainability of the industry.
As part of this, a project’s social impact will also be considered – including how supply chains affect jobs and communities.