UK’s Sixth Contracts for Difference Round Open

March 28, 2024, by Adnan Memija

On 27 March, the UK Government opened the sixth allocation round (AR6) of the Contracts for Difference (CfD) scheme which will continue until 19 April 2024. The round will see a range of renewable technologies, including offshore wind compete for the government’s support.

Applications may be submitted via National Grid ESO’s EMR Portal. The results are expected to be published at some point this summer.

The UK’s fifth CfD round closed in September last year and saw the UK government awarding 3.7 GW of renewable energy projects, however, none of those were offshore wind farms as offshore wind developers placed no bids.

Round 5 comprised two auction Pots: Pot 1 for established renewable energy technologies, including fixed-bottom offshore wind, and Pot 2 for less established technologies, including floating offshore wind.

In November 2023, the government announced that it increased the maximum strike price for offshore wind projects in the next CfD auction by 66 per cent for fixed-bottom and by 52 per cent for floating wind projects.

AR6 has the largest budget of any CfD round yet and comprises a range of renewable technologies, including offshore wind, solar, onshore wind, and tidal stream, competing for support across three separate auction pots, with the lowest-priced bids being successful.

The majority of the budget (approximately EUR 1.2 billion) is earmarked for offshore wind, GBP 800 million (about EUR 934 million).

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In February, Iberdrola unveiled that the company is getting the East Anglia One North and East Anglia Two offshore wind projects ready for the AR6.

The 800 MW East Anglia One North and the 900 MW East Anglia Two, proposed to be built more than 30 kilometres off the coast of Suffolk, received development consent in March 2022.