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New Energy World magazine logo
New Energy World magazine logo
ISSN 2753-7757 (Online)

9 GW of renewable energy secured in latest UK renewables auction

4/9/2024

Close up view of nacelle and blades at top of offshore wind turbine in foreground, with blue sky and calm sea behind Photo: Octopus Energy
Nine offshore wind projects totalling 4.9 GW have been announced under the UK government’s sixth auction round

Photo: Octopus Energy

The UK’s sixth renewables auction has secured 9 GW of new renewable energy capacity via 131 green infrastructure projects, making it the biggest round to date. Set to power the equivalent of 11 million British homes, the first projects will start generating electricity in 2026.

The successful results come after the incoming Labour government increased the auction budget by 50% to £1.5bn – seven times bigger than the previous round’s pot.

 

Among the contract awards are nine offshore projects totalling 4.9 GW, including what will be Europe’s largest and second largest wind farm developments, Hornsea 3 and Hornsea 4 off the Yorkshire coast.

 

This is a marked improvement on the previous auction round in 2023, which saw zero offshore wind projects among the 92 projects agreed, as the strike price was deemed too low.

 

Also among the projects in this year auction is the largest floating offshore wind farm in the world to reach market, Green Volt, as well as 22 onshore wind projects, totalling 990 MW. Six new tidal projects, totalling 28 MW, were also announced (just under half of the world’s operational tidal stream capacity being situated in UK waters).

 

A total of 93 ground-based solar projects also secured support under the sixth allocation round of contracts for difference (CfD), with a combined capacity of 3,288 MW, of which 884 MW has been contracted for delivery in 2026, 509 MW in 2027 and 1,895 MW in 2028.

 

For the first time, a solar farm with capacity over 50 MW secured a CfD. EDF Renewables’ Longfield development in Hertfordshire, the first to be approved nationally rather than by a local authority, received a contract for 299 MW of its 420 MW planned capacity.

 

Commenting on the results, Gemma Grimes, Solar Energy UK Director of Policy and Delivery, says: ‘To reach the government’s 50 GW solar energy target for 2030, an average of 3.3 GW of ground-mounted capacity will have to be delivered annually for the rest of the decade – very close to the amount cleared in this year’s auction. Further capacity is expected to be delivered under corporate power purchase agreements, or via selling directly to the grid as “merchant” facilities. An extra 10 GW or so is expected to be installed on roofs.’

 

The UK government reports that the sixth auction round projects were ‘agreed at well below the upper limit on the price set for the auction’.

 

However, noting the amount additional offshore wind capacity secured under the sixth auction round, Ami McCarthy, Greenpeace UK’s political campaigner, says: ‘The government clearly needs to take a hard look at how this system is working. 5 GW of offshore wind is of course welcome, but it is only about half of what is required each year to meet the government’s 2030 target.’ She continues: ‘Boosting homegrown renewable energy is the best way to ensure our energy independence and security, lower our bills, and tackle the climate crisis. This urgently needs to be followed up with a much bigger auction next year, as well as investment for faster grid connections, better planning, and more storage to hold the green power for when it’s needed.’

 

Furthermore, the UK trade union Unite was quick to point out that 70% of the offshore wind projects in the sixth round were awarded to the Danish multinational Ørsted and that, as there are currently no requirements in the auction process for bidders to utilise local manufacturing content, this could put the UK manufacturing sector at risk. ‘With the majority of jobs in offshore wind being in the manufacturing process this is crucial,’ it said. ‘Currently just 20% of UK wind manufacturing contains local content and nearly half (42%) of UK offshore wind farms are owned by foreign governments… Creating sustainable green jobs must be at the heart of the UK’s renewable energy strategy,’ it added. According to Unite research, if a manufacturing target of 60% of local content was met for offshore wind manufacturing, this could create 12,500 new jobs.