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Renewable Energy Sector Gets a £290 Million Public Funding Boost

04 Apr 15:00 by Steve Walia

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The government has released the terms of the next CfD auction for renewable energy technologies. Launched on 3 April, this will be the second Contracts for Difference energy rights auction.

Developers of renewable energy technologies will enter into a competitive bidding process to secure £290 million of public contracts in order to secure subsidy funding for new developments and to help Britain to continue with its transition to a low-carbon economy.

The contracts are procured through a competitive bidding process which acts to drive energy costs down for consumers whilst guaranteeing developers a set price for the green energy that they generate over a fifteen-year period.

This gives energy firms the certainty that they need in order to attractive private investment and to begin work on a range of projects.

These contracts are the first stage of the government's plan to provide as much as £730 million of support each year for green energy projects during the parliamentary term.

Jesse Norman, the energy minister, said that the auction demonstrated that the UK was open for business for firms that want to invest in sustainable low-carbon energy technologies.

The scheme will help to provide green energy to more than a million domestic properties whilst creating new employment in the energy sector and providing new opportunities in the supply chain. At the same time, it will help to slash carbon emissions by 2.5 million tonnes every year.

It is funded through a levy applied to customer energy bills, and only the most competitive projects win contracts. Energy bills only see the levy applied once projects are working and producing clean energy. This round of auctions is planned to end in the autumn, when the successful developers will be notified.