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The fourth Contracts for Difference (CfD) allocation round will open to applications in December 2021.
The announcement was made in an update on the resource portal for the allocation round which said the “confirmation of the round opening in December and no earlier will provide further clarity to prospective participants”.
The Department for Business, Energy & Industrial Strategy (BEIS) has previously stated that it will seek to procure 12GW of low-carbon generation– more than double the 5.8GW of capacity contracted in the previous auction in September 2019.
After more than half a decade without access, the allocation round will include an auction for more established “pot 1” technologies – onshore wind and solar. Less established technologies such as tidal and floating offshore wind will be able to compete in the “pot 2” auction and there will also be a third separate pot for offshore wind for the first time.
Alongside the announcement, BEIS also published its response to a consultation launched in November 2020 on changes to supply chain plans and contract terms.
BEIS confirmed plans to strengthen the supply chain plan process for projects of 300MW of above, including introducing new powers for the secretary of state to assess and then approve or reject generators’ implementation of their commitments. Those that do not receive approval will be unable to begin receiving payments and may have their contract terminated.
It also confirmed the decision not to extend phasing to floating wind due to the small size of prospective projects.
Commenting on the announcement, RenewableUK deputy chief executive Melanie Onn said: “The latest supply chain proposals set challenging new demands for project developers, so it’s vital that the guidance is clear on how we can demonstrate the contribution we’re making by creating thousands of jobs, developing skills and fostering innovation across the supply chain, as well as building vital new infrastructure.
“Project developers are already working with manufacturers to help them understand our projects’ needs and timelines, which will support investment in new facilities and the development of new skills in our workforce. Underpinning all this, we need large volumes of new capacity in the next CfD auction for new contracts to generate clean power to keep us on track for our 2030 target, quadrupling what we’ve already installed.”
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