Contracts for Difference secures wind power at a lower strike price than new nuclear power

[ALEO Admin]

On 11 September the government announced that the second Contracts for Difference auction has secured £176 million of new renewable energy projects, set to power 3.6 million homes, to come online between 2021 and 2023.

The strike prices - the guaranteed price to the generating firm - for new offshore wind farms has halved since the last auction in 2015. When the wholesale market price for electricity is below the strike price, payments to the firm are made up with a levy on consumers. However, when the wholesale price is above the strike price, the generator pays the difference back.

The strike price for two of the new offshore wind contracts is £57.50 per megawatt hour, which compares well with the Hinkley Point C nuclear plant that has secured a strike price of £92.50 per megawatt hour.

See the BBC report from 11 September, 'Offshore wind power cheaper than new nuclear', for more information: http://www.bbc.co.uk/news/business-41220948

The full Contracts for Difference allocation results are as follows:

Advanced Conversion Technologies, Strike Price (£74.75/MWh):

- Drakelow Renewable Energy Centre - England - 15 MW (27,190 homes)

- Station Yard CFD 1 - Wales - 0.05 MW (90 homes)

- Northacre Renewable Energy Centre - England - 25.5 MW (46,220 homes)

- IPIF Fort Industrial REC - England - 10.2 MW (18,490 homes)

- Blackbridge TGS 1 Limited - England - 5.56 MW (10,080 homes)

Advanced Conversion Technologies, Strike Price (£40.00/MWh):

- Redruth EfW - England - 8 MW (14,500 homes)

Dedicated Biomass with CHP (Strike Price £74.75/MWh):

- Grangemouth Renewable Energy Plant - Scotland - 85 MW (148,880 homes)

- Rebellion - England - 0.64 MW (1,120 homes)

Offshore Wind (Strike Price £74.75/MWh):

- Triton Knoll Offshore Wind Farm - England - 860 MW (893,690 homes)

Offshore Wind (Strike Price £57.50/MWh):

- Hornsea Project 2 - England - 1,386 MW (1,440,300 homes)

- Moray Offshore Windfarm (East) - Scotland - 950 MW (987,220 homes)

For more information on Contracts for Difference, visit:
https://www.gov.uk/government/news/new- ... lion-homes
and
https://www.gov.uk/government/publicati ... nd-results