The UK Government is to change the frequency of its Contracts for Difference (CfD) scheme to every year rather than every two years in order to accelerate the roll-out of renewables.
The plan to switch to annual CfD rounds was first reported in the 27 January edition of subscriber-only reNEWS.
The change kicks in from March 2023 when the next CfD round opens.
The Government said the move will support renewable electricity producers and boost the UK’s renewable energy infrastructure.
CfDs are the Government’s primary method of supporting renewable energy, driving down the cost of technologies and playing an important role in leveraging £90bn (€106.9bn) of private investment by 2030.
The auction scheme has already proved successful at bringing down the cost of offshore wind by around 65% over the past decade – helping the UK become one of the world’s largest generators of wind power.
In the last allocation round, 12 new contracts were awarded, with the potential for nearly 6GW of further capacity.
This is enough to power over seven million homes at record low prices and could see the creation of thousands of jobs across the UK.
Increasing the frequency of auctions will also give more projects the opportunity to enter the system, helping to scale-up the UK’s supply of renewable energy and to support the country’s long-term energy security, the Governement said.
Business and Energy Secretary Kwasi Kwarteng (pictured) said: “We are hitting the accelerator on domestic electricity production to boost energy security, attract private investment and create jobs in our industrial heartlands.
“The more clean, cheap and secure power we generate at home, the less exposed we will be to expensive gas prices set by international markets.”
Energy Minister Greg Hands added: “The UK is already leading the world in renewable energy and today’s announcement will take us even further.
“This will help provide cheaper energy to consumers, guaranteeing more of our energy is produced at home and reducing our dependence on fossil fuels.”
RenewableUK chief executive Dan McGrail said: “Moving to annual CfD auctions is a major step forward which will significantly accelerate the speed of our nation’s transition to net zero.
“It’s good news for consumers too, as it means the UK will be reducing its vulnerability to volatile international gas prices and increasing the volumes of low cost renewable energy in our energy system.
“There’s a huge appetite among renewable energy developers to invest in building more projects, which will help to grow the UK supply chain at a faster rate.
“This will enable us to maximise the economic benefits which this sector offers to everyone, especially in parts of the country which urgently need levelling up.
“We need build up to 4GW of new offshore wind capacity every year to stay on track for net zero, which means quadrupling our current annual rate.
“Similar increases in onshore wind, solar and other clean power sources are vital too, as well as ramping up the roll-out of innovative technologies like floating wind, green hydrogen and marine power.”