Six projects, representing 5.5GW of offshore wind, that were successful in the last Contracts for Difference (CfD) auction have now passed their “milestone requirement”.
This means the winning bidders have demonstrated their commitment by spending at least 10 per cent of the expected development and construction costs and by proving finance is available and contracts signed to deliver their projects.
However, two of the projects that secured contracts in the October 2019 third allocation round have now had these agreements terminated after failing to achieve the milestone requirement. These were the Bulwell and Small Heath advanced conversion technology (ACT) projects.
The four remote island wind projects that made up the rest of the awarded contacts have been given an extended deadline to prove they are on track.
The six schemes to hit their targets are Sofia (awarded 1.4GW of capacity ), Dogger Bank A, B and C (1.2GW each), Seagreen (454MW) and Forthwind (12MW).
The projects are due to come online in the mid-2020s, and between them will typically generate around 23.9TWh of electricity annually – enough to power over 8 million homes.
Neil McDermott, chief executive of the Low Carbon Contracts Company, which manages the CfD process, said: “Allocation Round 3 projects faced challenges on an unprecedented scale due to the impacts of a judicial review, uncertainty around EU exit, and the global pandemic. I’m incredibly proud to see these projects pass this important milestone and I commend the determination and teamwork that went into achieving it.”
“The projects include some of the world’s largest offshore wind farms to date, so this outcome demonstrates the CfD’s vital role in supporting new low-carbon power projects to secure investment and, ultimately, in developing the ambitious infrastructure we need to power the UK’s transition to net zero emissions by 2050.”