UK Opens Door to More Low-Carbon Power

The third round of the UK government’s scheme to support low-carbon electricity generation opened May 29, with £65mn ($80mn)/yr on offer to support as much as 6GW of new renewable energy.

The Contracts for Difference (CfDs) scheme is the government’s primary method of supporting low-carbon electricity, encouraging investment in renewables by providing projects with a stable income while protecting consumers from paying increased support costs when electricity prices are high.

In a statement, a spokesman said the government wanted 70% of the country's electricity to come from low-carbon sources by 2030, "and the opening of today’s allocation round is an important step towards that goal. The £65mn of support on offer will help us decarbonise our energy system and reach net zero emissions, ending our contribution to global warming.”

This new round is open to less established renewable technologies such as offshore wind and combined heat and power biomass, with registration closing June 18. Winners are due to be contributing power to the grid from 2023/24.

Around 10 GW of new renewable power projects have been awarded CfD contracts since 2015. Almost a third of the UK’s electricity last year came from renewable generation including wind, bioenergy, solar and hydro power, it said, although it did not comment in the statement on the cost this has had in terms of balancing a system in real-time with unpredictable supplies coming on to the grid, and negative power prices.

Over £490mn have been allocated through the first two rounds of the CfD scheme, and in the Clean Growth Strategy the government said it would be making up to £557mn of annual support available for further CfD projects.