UK Targets 12 GW of Renewables in Round 4 CfD Auction

The UK government aims to support up to 12 GW of renewable energy projects in the fourth round of the Contracts for Difference (CfD) scheme.

Set to open in late 2021, the Round 4 CfD auction will divide renewable technologies into three so-called ‘pots’.

Pot 1 is reserved for established technologies such as onshore wind and solar PV.

Pot 2 will include less-established technologies including floating offshore wind, advanced conversion technologies, and tidal stream.

Floating offshore wind projects will be able to bid for contracts for the first time, allowing wind farms to be built further away from the shoreline where it is windiest and increasing the UK’s renewable energy capacity even further, the UK’s Department for Business, Energy & Industrial Strategy (BEIS) said.

Pot 3 is reserved only for offshore wind. Given its long-term potential to support the country’s 2050 net-zero target, offshore wind projects will compete in their own pot in the next auction process rather than against other technologies as they have previously, BEIS said.

”The UK is a world leader in clean energy, with over a third of our electricity now coming from renewables. That huge achievement is thanks to the government’s Contracts for Difference scheme,” the UK’s Energy Minister Kwasi Kwarteng said.

”The new plans set out today build on the Prime Minister’s Ten Point Plan and put us firmly on the path towards building a new, green industrial revolution.”

The fourth round aims to increase the capacity of renewable energy from the 5.8 GW achieved in the last round to up to 12 GW, which could be enough to power 20 million electric cars on the UK’s roads in any year.

Following the first consultation on the fourth CfD round, the government has also announced that a second consultation is being launched on new proposals for the Supply Chain Plan.

The proposals are designed to increase the clarity, ambition and measurability of commitments made by renewable project developers when they bid for contracts in the CfD scheme, and to introduce new measures if they subsequently fail to deliver on those commitments.