By Susanna Twidale
LONDON (Reuters) -Britain is offering a smaller budget for offshore wind in its next auction round to spur investment in renewable power capacity, government documents showed on Monday, with one analyst saying the country will struggle to meet its clean power targets.
Documents released on Monday showed the next auction round will have a budget of 900 million pounds for traditional, fixed offshore wind projects, down from 1.1 billion pounds last year.
A further 180 million pounds will be for earlier-stage floating wind technology, which did not have a dedicated budget last year and had to compete with other emerging technologies such as tidal and geothermal.
The country is focusing on offshore wind in its plans to decarbonise its electricity sector by 2030, aiming to boost its offshore wind power capacity to 43-50 gigawatts (GW) by the end of the decade from around 15 GW currently.
To help ensure projects are built, it holds annual auctions offering renewable power developers a guaranteed price for their electricity called Contracts for Difference.
“Our competitive new auction process will allow us to buy the right amount of clean power at the right price,” British Minister for Energy Michael Shanks said in a statement.
But the proposed funding will likely leave the country short of meeting its clean power targets, said Pranav Menon, a senior researcher at Aurora Energy Research.
He said if similar prices to last year are achieved at this year’s auction round, it would likely secure around 4.9 GW of new capacity.
“This would set the Government’s ambitious offshore wind capacity target to achieve CP2030 (clean power 2030) out of sight, as it requires at least 7GW-9GW to be procured, which would require extremely competitive bids that are unlikely to materialise,” he said in an email.
Further funding will be available for other renewable projects such as geothermal and tidal stream technology, but the government has not announced the budget for these.
Last year’s auction had a total budget of 1.5 billion pounds for all technology types including 1.1 billion pounds for fixed offshore wind projects.
($1 = 0.7451 pounds)
(Reporting by Susanna Twidale; Editing by Peter Graff and Hugh Lawson)
