Solar and onshore wind will compete for a share of £50 million a year under the contracts for difference (CfDs) scheme, according to a document published by the Department for Energy and Climate Change (DECC).
Established technologies, which include solar PV, onshore wind, hydro and landfill gas, will compete for an annual budget of £50 million in the first auction round, with contracts lasting 15 years. Bidding for 2015/16 will begin on 14 October 2014. The final budget will be announced on 29 September. DECC has indicated that the second auction round in autumn 2015 could also comprise of a £50 million annual budget for established technologies.
Less established technologies will get no support in 2015/16 but will then receive £155 million annually.
DECC claims that a number of factors could change the preliminary figures depending on levy control framework spending between now and then and assumptions used in developing the budget, such as fossil fuel prices.
The draft budget comes one week after solar advocate Greg Barker MP resigned from the department.
“Average annual investment in renewables has doubled since 2010 – with a record breaking £8billion worth in 2013,” said Ed Davey, secretary of state for energy and climate change.
“These projects will create green jobs and green growth, reduce our reliance on foreign-controlled volatile energy markets and make sure billpayers get the best possible deal.
“We’re building a secure, low-carbon electricity system that will be the powerhouse of the British economy, supporting up to 250,000 jobs by 2020,” claimed Davey.
Speaking to Solar Power Portal, Leonie Greene, head of external affairs at the Solar Trade Association described the provisional budget as “very disappointing”.
Greene continued: “It is clear that the government is favouring more expensive technologies over solar.” Looking ahead, Greene added that the solar industry must keep making the economic case of solar to the government in an attempt to secure more budget.
Speaking to Solar Power Portal, Ray Noble, consultant at the National Solar Centre said: “While all reports now show that solar is going to dominate the global energy market (Shell etc.) it seems, once again, this government are completely out of touch with the potential for solar in the UK. There 'head in the sand' attitude shows that they are still married to old energy generation technologies or those that will double the price of electricity by 2023. Now it looks like we know why Greg Barker resigned!”
This article has been updated to clarify the details of future budget allocation rounds.