Six energy from waste projects and two biomass combined heat and power projects have secured funding in the second government ‘Contracts for Difference’ (CfD) auction for renewable technologies.
In total, 11 new energy projects were successful in the government auction and are worth up to £176m per year and set to generate over 3GW of electricity – enough to power 3.6 million homes, the government announced earlier this week. The other three were wind power.
But, the significance of the six EfW projects, which are conversion rather than traditional technologies, and the two biomass schemes is dwarfed by the three offshore wind projects – with all six EfW projects set to power 116,570 homes compared to over 3 million homes to be powered by offshore wind energy. One EfW project in Wales is only expected to power 90 homes.
The EfW projects or ‘Advanced Conversion Technologies’ (ACT) that were awarded include projects by Future Earth Energy, DC2 Engineering, Northacre Renewable Energy, Legal and General Prop Partners, Think Greenergy TOPCO and Redruth EFW. And biomass developers, Grangemouth Renewable Energy and Rebellion Biomass were also awarded.
These projects were able to achieve significant savings when compared the first auction held in 2015, said the government.
The auction shows substantial price reductions, with energy from waste and biomass clearing at prices from £40.00 to £74.75
In the first CfD auction, held in 2015, contracts worth £315m were awarded to 27 schemes, with five of the schemes including ACT projects. But it is thought that only a few ACT schemes have achieved financial close since the 2015 auction.
Minister for Energy and Industry, Richard Harrington, said: “We’ve placed clean growth at the heart of the Industrial Strategy to unlock opportunities across the country, while cutting carbon emissions.
“The offshore wind sector alone will invest £17.5bn in the UK up to 2021 and thousands of new jobs in British businesses will be created by the projects announced today. This government will continue to seize these opportunities as the world moves towards a low carbon future, and will set out ambitious proposals in the upcoming Clean Growth Plan.”
Reacting to the auctions, Mark Sommerfeld, policy analyst at the Renewable Energy Association said the auction “demonstrated that Advanced Conversion Technology energy from waste projects are able to deliver renewable base load capacity at a highly competitive price”.
Mr Sommerfeld added: “The government must now seriously re-think the UK’s waste management strategy and align the successful existing renewable power auctions more closely to it. Government policy needs to focus on how to incentivise delivery of the full range of waste based products that ACT technology offers. This would be a major step towards the sustainable management of the UK’s waste and would support the production of green transport fuels, chemicals, and heat.”