Engineering news
Additional investments of around £40 billion are expected in renewable electricity generation projects before 2020 in the UK, after the Government updated the terms of contracts and “strike prices”.
The strike price arrangements are far more enticing for offshore wind compared with onshore, as the government seeks to encourage developers to construct new windfarms around the coastline of Britain, where they face less public objection.
The strike price for offshore wind will be £155/MWh in 2014/15, while onshore wind will receive £95/MWh.
Danny Alexander, chief secretary to the Treasury, insisted onshore wind farms would continue to play “a big role”, and denied that the subsidy level was a response to Tory opposition. Rural wind farms have been a source of coalition tension, with many senior Conservatives staunchly opposed to the turbines, which Lib Dems say are needed to meet environmental objectives.
Sixteen renewable generation projects in the planning phase also reached the last stage of the Final Investment Decision Enabling for Renewables (FIDeR) process today. FIDeR was created by the Government to ensure that private investment in planned renewable energy projects in the UK doesn't drop off because of uncertainty during energy market reform.
There is over 20GW of renewables capacity operational in the UK – a figure that could double by 2020 as a result of the reforms, said the Department for Energy and Climate Change (DECC).
A total of almost 11GW of offshore and onshore wind capacity has been awarded planning consent and is awaiting construction. If all the 8GW of projects proceeding under FIDeR are built they could contribute around 30% of the new renewables generation needed by 2020, DECC said.
Energy and climate change secretary Ed Davey said: “Investors are queuing up to express their interest in these contracts. This shows that we are providing the certainty they need, our reforms are working and we are delivering ahead of schedule and to plan.”
Meanwhile, the Treasury has signed a co-operation agreement with Japanese firm Hitachi and its subsidiary Horizon to promote external financing for a new nuclear power station at Wylfa on Anglesey.
Horizon chief operating officer Alan Raymant said: “This is another step forward for Wylfa Newydd. It will build confidence amongst our supply chain, future workforce, local communities, and importantly potential investors.
“New nuclear must be a part of the future energy mix given our long-term need for reliable low-carbon electricity which is also affordable for the consumer.”