Eight major renewable electricity projects are unveiled as part of the government’s electricity reforms, giving a massive boost to green growth and green jobs.
The projects have been offered under Contracts for Difference (CfD), which form part of Government’s Electricity Market Reform programme. They include offshore wind farms, coal to biomass conversions and a dedicated biomass plant with combined heat and power.
By 2020, the projects will provide up to £12bn of private sector investment, supporting 8,500 jobs, and they could add a further 4.5GW of low-carbon electricity to Britain’s energy mix (or around four percent of capacity), generating enough clean electricity to power over 3m homes.
Once built, the successful projects will contribute around 15TWh or 14 percent of the renewable electricity we expect to come forward by 2020, helping to put the UK well on the way to meeting the UK’s renewable energy target.
They will also reduce emissions by 10 MtCO2 per year compared to fossil fuel power generation.
Edward Davey – “These are the first investments from our reforms to build the world’s first low carbon electricity market – reforms which will see competition and markets attract tens of billions of pounds of vital energy investment whilst reducing the costs of clean energy to consumers”
Energy and Climate Change Secretary Edward Davey said: “These contracts for major renewable electricity projects mark a new stage in Britain’s green energy investment boom.
“By themselves they will bring green jobs and growth across the UK, but they are a significant part of our efforts to give Britain cleaner and more secure energy.
“These are the first investments from our reforms to build the world’s first low carbon electricity market – reforms which will see competition and markets attract tens of billions of pounds of vital energy investment whilst reducing the costs of clean energy to consumers.
“Record levels of energy investment are at the forefront of the Government’s infrastructure programme and are filling the massive gap we inherited. It’s practical reforms like these that will keep the lights on and tackle climate change, by giving investors more certainty.
“There has been significant growth in renewable electricity sector with the renewables’ share of total electricity generation more than doubling since 2010. We are supporting this growth to continue through Electricity Market Reform and expect to deliver over 30 percent renewable electricity in 2020.”
Final Investment Decision
Today’s announcements, the first step in the new EMR Contracts for Difference regime, will make a significant contribution towards that ambition by, in 2020, delivering around 15TWh – that’s five percent of total electricity generation – from today’s eight projects alone.
The eight successful projects have been awarded contracts under the Final Investment Decision (FID) Enabling for Renewables process, allocating the first CfDs that are being introduced through the Electricity Market Reform programme. Under CfDs, generators and developers receive a fixed strike price for the electricity they produce for 15 years.
These contracts are vital to give investors the confidence they need to pay the up-front costs of major new infrastructure projects.
The contracts are supported by the new legislative framework introduced through the Energy Act 2013. Further CfDs will be made available in the autumn and the Government intends to publish further details of the allocation process alongside the Government Response to the January Consultation on Competitive Allocation of CfDs shortly.
DECC says that the successful projects will help provide a secure, affordable supply of electricity and support skilled jobs, boosting growth, supply-chains and businesses across the country.