The UK government has opened to applications for the latest round of the Contracts for Difference (CfD) renewable support scheme with £285m/year (€335m/year) funding for renewables projects. The United Kingdom is aiming to secure 12 GW of electricity capacity in the fourth round of the CfD scheme; 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 at arm’s length from government. Bids are open until 14 January 2022, with the final results of the auction expected to be announced in spring-summer 2022.
Offshore wind will be supported by £200m/year (€235m/year) funding, in a pot with no capacity cap. Less-established technologies such as floating offshore wind, tidal stream, geothermal and wave will compete for a £75m/year (€88/m) budget, with £24m (€28m) initially allocated for floating offshore wind and £20m (€23m) on tidal stream projects; this pot will have no capacity cap. Finally, onshore wind, solar and hydropower are competing in an allocation round for the first time since 2015. Indeed, the government allocated £10m (€12m) for established technologies such as onshore wind, solar, and hydro, with a cap of 5 GW (maximum capacity limits of 3.5 GW imposed on both onshore wind and solar PV).
In addition, the Office of Gas and Electricity Markets (Ofgem) will hold a third investment round for interconnectors in 2022. The new cap and floor investment round targets interconnectors that can connect by the end of the decade. The energy regulator will also run a pilot cap and floor scheme for Multiple-purpose Interconnectors (MPIs), which can link up clusters of offshore wind plants directly to an interconnector. The country currently has 7.4 GW of electricity interconnectors with Ireland, France, Belgium, the Netherlands and Norway. The United Kingdom targets at least 18 GW of interconnection and 40 GW of offshore wind by 2030.
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