SSE has welcomed the latest draft budget allocation from UK Energy Department BEIS for the next Contracts for Difference renewables auction, and said that strike prices were “approaching subsidy free levels”.
The energy provider highlighted yesterday’s announcement of a draft budget of £60m for CfD3 as an important milestone in the government’s commitment to a long-term policy frame work for offshore wind.
However, the company said that strike prices are “ambitious”.
A statement said: “Competitive auctions have been effective in driving down the price of offshore wind, and rightly so, but the strike prices set out are approaching ‘subsidy free’ levels which is ambitious.
“To deliver projects at this level, while also meeting higher local content targets will require close collaboration between offshore developers, supply chain partners and financiers.
“A cap on capacity is disappointing when there’s more than 6GW of low carbon projects ready to play a part in delivering the clean energy infrastructure we need to decarbonise the power sector.”
SSE added: “We’d urge BEIS to publish the Allocation Framework as soon as possible to give developers sight of how the overall budget will be awarded to help inform the bid process.”
BEIS revealed its proposals in announcement on Tuesday, with an auction due to commence in the spring of next year.