- REA welcome £265m of annual funding to be provided in the fourth round of the Contracts for Difference (CfD) scheme;
- Today’s announcement contains £200 million to support offshore wind projects, but just £55 million has been allocated for emerging renewable technologies;
- REA urges the government to provide greater support for technologies at an earlier stage of deployment, such as marine and geothermal.
The Association for Renewable Energy and Clean Technology (REA) have welcomed the announcement of the fourth round of the CfD scheme, but have warned the government that more support must be offered to technologies at an earlier stage of deployment to bring their costs down and help meet the UK’s Net Zero ambitions.
The CfD scheme is the Government’s primary method of encouraging investment in low-carbon electricity, incentivising investment in renewable energy by providing developers of projects with high upfront costs and long lifetimes with protection from volatile wholesale prices.
Today’s announcement includes £265 million per year that will be provided to businesses in the fourth round of the scheme, which aims to double the renewable electricity capacity secured in the third round and generate more electricity than the previous three rounds combined.
However, the fourth round contains £200 million to support offshore wind projects, but just £55 million has been allocated for emerging renewable technologies, £24 million of which is ring-fenced for floating offshore projects.
The REA says that emerging technologies such as geothermal, marine and Advanced Conversion Technologies all need better government support.
Frank Gordon, Director of Policy at the Association for Renewable Energy and Clean Technology (REA), said:
“The REA welcomes the extra funding for renewable power at this year’s CfD auction, but are concerned that developing technologies at an earlier stage of deployment than offshore wind are still not being adequately supported by the CfD.
“For example a minima’ (reserved capacity) should be provided for geothermal, marine and Advanced Conversion Technologies, so that they do not miss out entirely in the auctions. This would bring the costs of these technologies down by deploying at scale and help provide the energy mix we need to meet our Net Zero ambitions.”
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Notes to editors
See the Department for Business, Energy & Industrial Strategy’s full press release here.
See ‘Contracts for Difference: Allocation Round 4’ documents and guidance here.
About the Association for Renewable Energy and Clean Technology (REA):
The Association for Renewable Energy and Clean Technology (known as the REA) is the UK’s largest trade association for renewable energy and clean technologies with around 550 members operating across heat, transport, power and the Circular Economy. The REA is a not-for-profit organisation representing fourteen sectors, ranging from biogas and renewable fuels to solar and electric vehicle charging. Membership ranges from major multinationals to sole traders.
For more information, visit: www.r-e-a.net