The Crown Estate has published the results of the Contract for Difference Allocation Round 5, revealing no offshore wind projects, fixed or floating, were successful in securing a subsidy contract in this years round.
The Crown Estate launched the first of the annual CfD rounds at the start of the year, offering subsidy contracts for developers of offshore wind, onshore wind, as well as solar PV and other marine projects. The strike price cap was set at £44/MWh for fixed and £114/MWh for floating offshore wind. In addition, new to this years round, was a common allocation pot for fixed offshore wind, solar PV and onshore wind. The changes in the allocation pots and the set strike price caps have been met with a lackluster response from offshore wind developers in the UK, warning that the contracts on offer did not match the reality of increased costs in the industry.
In contrast, in CfD round 4, hosted last year, support to 7 GW of offshore wind was awarded. The strike price for offshore wind in round 4 was £37.35 per megawatt-hour. The lack of successful bids from offshore wind in CfD round 5 sends a strong signal to the UK government on the increased cost the industry is experiencing and puts the 2030 50 GW offshore wind target in danger of being difficult to meet. The next allocation round, CfD round 6, is set to be hosted in 2024.
Image Credit: SSE Renewables
