Summary
The UK government plans to pay higher prices for electricity from new wind farms as it attempts to lower household bills and reduce fossil fuel use by 2030. This change affects upcoming auctions where companies bid for government-backed contracts to produce renewable energy. The new maximum price for offshore wind, known as the Administrative Strike Price, is set at £113 per megawatt-hour.
Key Facts
- The government raised the maximum price it will pay for new wind-generated electricity.
- This increase aims to support goals of reducing household energy costs and using less fossil fuel for power by 2030.
- Auctions in August allow firms to bid for contracts to generate renewable energy.
- The new maximum price for offshore wind is £113 per megawatt-hour, up from £102.
- Floating offshore wind prices rose to £271/MWh from £245.
- Onshore wind prices increased slightly, while solar energy costs decreased.
- Companies submit bids below the maximum price to secure contracts, and actual prices may be lower.
- Contract lengths for wind and solar projects have extended from 15 to 20 years.
