The budget for Allocation Round 7 offshore wind projects unveiled by the UK government on 27 October 2025 has aroused a lot of comment, not least because it is unlikely to keep the UK on track towards its Clean Power 2030 (CP 30) targets
As BVG Associates associate director Graham Gow told OWJ, “With the benefit of a day or two of reflection following the announcement of the AR7 budget, my underlying feeling is one of mild bemusement.
“It has landed as a somewhat frustrating contradiction. Everyone has noted the smaller than expected budget. It is looking like we’ll get in the region of 5 GW, give or take a little,” as the graph below demonstrates.
“The question is simply, ‘Why?’ The low budget is a contradiction, primarily of the government’s own messaging, but also in its stated wider ambitions.”
Mr Gow explained that work BVG Associates did for Scottish Renewables earlier this year projected the UK offshore wind pipeline was likely to miss the CP 30 targets. “Even so, we estimated around 12.5 GW of capacity would be eligible for AR7. In fact, the pipeline at the time suggested an annual average of 12.5 GW each for ARs 7 to 10 inclusive – massive numbers, but still not quick enough to meet CP 30 targets.
“Then the news came that the eligibility criteria for AR7 was to be relaxed, allowing up to 20 GW to qualify. Not only that, but the government extended the contract period from 15 to 20 years. That sounded like great news.
“But then here is the contradiction: why expand an already massive 12.5 GW potential to 20 GW, then only provide enough budget for 5 GW? We all agree on the need for some level of competitive tension, but a budget for 10 GW would still mean 50% attrition – and even that feels too high for an industry that is encouraged to be on the front foot, with optimism and ambition, and has invested hundreds of millions in getting projects to the stage they are at.”
