The results of the sixth auction round (AR6) of the government’s Contracts for Difference (CfD) scheme have been released by the Department for Net Zero and Energy Security (DESNZ).
A total of 93 ground-based solar projects, with a combined capacity of 3.3GW, scored support. Indeed, AR6 was allotted the highest-ever budget for a funding round, reaching a total of £1.5 billion after the Labour government announced a £500 million increase on 30 July.
Strong market engagement meant competitive price discovery, which led to clearing prices for solar PV, onshore and offshore wind being awarded at over 18% below their administrative strike prices.
Hailing AR6’s success, energy secretary Ed Miliband said: “This auction has produced a record number of solar projects bolstering our mission for a solar revolution, we have powered forward with onshore wind, secured the largest commercial floating offshore wind project in the world and got the offshore industry back on its feet.”
Solar PV achieved a strike price of £50.07/MWh, above the prices achieved in both AR4 (which was £45.99/MWh) and AR5 (which was £47.00/MWh, the maximum allowable price for the auction). Although it was called “disastrous” by Miliband because no offshore wind won contracts, AR5’s outcome was positive for the solar industry: 56 solar projects were secured, with a total capacity of just over 1.9GW.
This auction round beats a record set in AR4, when 66 solar projects, coming to 2.2GW, gained CfDs.
EDF Renewables’ Longfield Solar Energy Farm, a nationally significant infrastructure project (NSIP) with 400MW generational capacity that secured a development consent order (DCO) in June 2023, won 299MW in AR6.
This was the highest capacity awarded. The smallest was 8MW to Burton Top Farm, being developed by Boultbee Brooks.
Last year, Low Carbon welcomed the AR5 results, having been offered CfDs for 10 solar projects with a capacity of more than 350MWp. In AR6, it won six projects with a combined capacity of 180MW.
According to Cornwall Insight, solar’s CfD success results from a strong pipeline of assets across many Great British regions and its competitive edge over onshore wind. Despite this positive result, combining operational and future CfD contracted capacity, total solar PV capacity in Great Britain is expected to reach at least 23.3GW—well below the 50GW target set in Labour’s Green Prosperity Plan.
This article was originally published in full on our sister site, Current±.
