The UK’s latest auction for renewable energy, Allocation Round 4 (AR 4), has seen nearly 7 GW of offshore wind capacity awarded a contract for difference (CfD) and one floating wind project, TwinHub, secure a CfD
A total of five bottom-fixed offshore wind projects were awarded CfDs. Nearly 11 GW of renewables capacity of all types was awarded a contract.
The bottom-fixed offshore wind projects were awarded contracts at a strike price of £/MWh, which compares with the lowest level in 2019 of £/MWh. This is the the lowest clearing price of all of the technologies in the auction.
Hence the cost of offshore wind has fallen again, but not dramatically as in former auctions, although the results of AR 4 show that it has now fallen below the cost of onshore wind. Onshore wind projects awarded CfDs in AR 4 came in at a strike price of £/MWh.
The 32-MW TwinHub floating wind project – the first floating windfarm awarded a CfD – came in at a strike price of £/MWh.
The government said the circa 7 GW of capacity from new offshore wind projects will increase the country’s overall capacity built and under construction by 35%.
Among the offshore wind projects securing a CfD are Norfolk Boreas Phase 1, East Anglia Three Phase 1, Hornsea Project Three, Moray West and the Inch Cape Phase 1 offshore windfarm.
The government said the latest auction would deliver almost double the capacity achieved in the previous auction round and enough energy to power around 12 million British homes.
