The UK government is set to boost the guaranteed price for offshore wind projects in its upcoming renewables auction, with a significant increase of 66%. This move aims to promote further investment in the sector, according to a statement released on Thursday.
Under the new terms, offshore wind projects will be offered a strike price of £73 ($90.64) per megawatt-hour. This represents a substantial increase from the previous auction round, where the strike price stood at £44. In addition, floating wind projects will be offered £176 per megawatt-hour, up from £116.
The lack of bidders in the September auction was primarily attributed to the offered price not reflecting the industry’s escalating costs. Acknowledging this concern, the government aims to address it by implementing more attractive pricing in the upcoming auction.
Moreover, projects that successfully reduce carbon emissions within their supply chains and demonstrate positive social impact on local communities may be eligible for additional financial incentives during the 2025 auction.
Interested parties can expect the auction to commence in March next year.
Significant updates were also made to the maximum bid prices for geothermal, solar, and tidal projects.