The government has announced plans to allow remote wind projects to compete in future Contracts for Difference (CfD) rounds.
The department for businesses, energy and industrial strategy (BEIS) has today (15 December) launched a consultation on proposed changes to the CfD scheme, which includes the creation of a new technology category – remote islands wind – that would be allowed to compete in future auctions.
According to the consultation document, the new category will support the development of wind projects on remote islands, including off the Scottish coast.
It states wind projects on such islands often have high transmission costs and high-load factors, which set them apart from other renewable energy schemes.
The document also states the government wants to set a separate administrative strike price for remote islands wind.
In order to qualify as a remote island wind project, a scheme must be located on a remote island and the connection between the unit’s generation circuit and the main interconnected transmission system will require at least 50 kilometres of cabling, of which 20 kilometres must be subsea cabling.
And following completion, the scheme must be connected to the national transmission system for the UK.
“Wind projects in the remote islands of Scotland have the potential to generate substantial amounts of electricity and cut emissions, supporting economic growth and delivering lasting benefits for communities,” said the UK government’s minister for Scotland, Lord Duncan.
The consultation also includes proposed changes to the efficiency requirements for combined heat and power, methods of determining an updated greenhouse gas emissions standard and new load factor assumptions.
The most recent CfD round results, which were announced in September, saw the cost of offshore wind clear a price of just £58/MWh from 2022-23.
Earlier this month, energy minister Richard Harrington revealed the government is seeking state aid approval from Brussels to classify remote island wind as a separate technology in the CfD scheme.
The Energy and Climate Information Unit’s (ECIU) energy analyst, Dr Jonathan Marshall said: “If these projects can keep pace with the dramatic falls in offshore, it could prove to be a foot in the door for a new approach to onshore wind that will benefit both the economy and the environment.
“The justification for allowing remote island onshore wind could also apply to onshore projects on the mainland,” added Marshall.
Speaking to Utility Week, the executive director of RenewableUK, Emma Pinchbeck, said the UK government had already said it was going to consult on remote island wind, which it sees “as a less-established technology”.
“The good thing about this consultation is the geography looks more spread out, so they are classifying islands off the south coast of England and off the coast of Wales as remote too, which is good,” Pinchbeck told Utility Week.
“In terms of what it means for onshore, they are not directly related, but this has shown it’s possible to amend policy when you have a strong reason for doing it and there’s public support for the technology.
“We know mainland onshore wind is popular and the Scottish and Welsh governments have publically called for it, and the government themselves have said they are trying to find a solution to do onshore wind in parts of the UK that want it. We would encourage them to push on with that work.”
She added the proposed changes to load factor assumptions are also “good news” because it will mean the BEIS load factors for wind “will be more accurate and representative of the most efficient projects we’ve got”.
The managing director of BVG Associates, Bruce Valpy welcomed the consultation and added it had “flagged” issues about the government’s low estimates of load factor many years ago
“The proposals certainly look as if they will go a long way to addressing those issues for future auctions,” said Valpy.
“It is right that local communities benefit very significantly from island projects, so further focus in that area is also welcome. Finally, we have seen real national benefit through the use of project-specific supply chain plans in offshore wind, so their use in the lead up to CfD auctions for onshore projects makes absolute sense.
“With no changes proposed to the supply chain plan format, developers for all projects can start to develop their plans for the spring 2019.”