The UK Government has announced the results of its latest flagship renewable energy auction, securing a record amount of new offshore wind capacity. However, the Scottish Government has immediately criticised the outcome as a "missed opportunity" for Scotland, blaming a limited budget and "unfair" transmission charges.
Historic Win for UK Energy Security
The seventh allocation round of the Contracts for Difference (CfD) scheme, known as AR7, has confirmed deals for 8.4 gigawatts (GW) of new offshore wind power. This volume is in line with what experts stated was required this year to keep the government on track for its pledge of clean power by 2030.
The auction awarded six new wind farm projects across the country. On average, these projects will receive £91 per megawatt hour for the electricity they generate. UK Energy Secretary Ed Miliband hailed the results as a "historic win" for Britain's energy sovereignty, claiming it would bring down bills "for good".
"With these results, Britain is taking back control of our energy sovereignty," Miliband said. "This is a historic win for those who want Britain to stand on our own two feet... It is a monumental step towards clean power by 2030." He emphasised that the price secured was 40% lower than the cost of building and operating a new gas plant.
Scottish Projects at a 'Competitive Disadvantage'
Despite the UK-wide success, the response from Edinburgh was far more critical. While welcoming the success of two Scottish projects—Berwick Bank in the North Sea and Pentland off the Caithness coast—Scottish Energy Secretary Gillian Martin said "much more" could have been achieved.
Martin pointed directly to the UK Government's "limited AR7 budget" and the ongoing issue of transmission charges, which she labelled as unfair and disproportionate. These charges, which are higher for generators in Scotland compared to those in England and Wales, are said to have put Scottish projects at a severe competitive disadvantage.
"We have repeatedly warned that a limited AR7 budget and unfair transmission charges would put Scottish projects at a competitive disadvantage, despite holding more than a third of the total UK offshore wind pipeline," Martin stated. "These results clearly demonstrate the impact of the UK Government decisions."
Calls for Reform and Future Hopes
The Scottish Government is now urging for fundamental changes to the charging regime ahead of the next auction round, AR8. Martin called on Westminster to "act urgently" to support the deployment of Scotland's strong project pipeline, ensuring more schemes can succeed in the future.
Among the successful projects, Berwick Bank, developed by SSE, is notable. If built to its full projected capacity of over 4GW, it could become one of the largest offshore wind farms in the world. SSE's Chief Executive, Martin Pibworth, expressed delight at the CfD award for its 1.4GW Berwick Bank B phase, highlighting its potential for delivering affordable, secure clean energy from Scotland's excellent wind resources.
While the auction represents a significant step towards UK decarbonisation goals, the stark divergence in opinion between London and Edinburgh underscores the ongoing tensions in energy policy and market design across the British Isles. The focus now shifts to whether reforms can be agreed before the next critical auction round.
