The Energy Secretary has announced a budget of over £1.5bn to deliver homegrown clean energy projects and boost energy security.
A series of new homegrown clean energy projects will boost energy security, secure cheap power for families, and unlock economic growth and jobs for the country.
Ed Miliband today announced the budget for this year’s renewable energy auction is being increased by £500m to over £1.5bn – a record budget – helping build new green infrastructure as part of the mission to deliver clean power by 2030.
Moving towards more use of clean energy
Funding will accelerate the delivery of clean, cheap, low-carbon electricity to families and businesses generated by renewable energy technologies such as wind turbines and solar panels.
Investing in clean energy is part of the government’s plans to make Britain a clean energy superpower. This will boost the country’s energy independence so that families and businesses are never left that vulnerable again.
This includes £1.1bn for offshore wind – the backbone of the UK’s clean energy mission – which has more budget available than all of the previous auctions combined, sending a strong signal to the industry to invest in UK waters.
Last week, the government launched Great British Energy in partnership with the Crown Estate, which is estimated to create up to 20-30GW of new offshore wind developments reaching seabed lease stage by 2030.
Clean power by 2030
The uplift comes on the day of the first meeting of the Clean Energy Mission Board – chaired by the Energy Secretary and attended by Ministers from across Whitehall – as part of plans for a mission-driven government.
The board will meet to ensure a relentless focus on delivering the mission of clean power by 2030 and accelerating towards net zero.
Energy Secretary Ed Miliband said: “We are backing industry to build in Britain, with the biggest budget yet.
“This will restore the UK as a global leader in green technologies and deliver the infrastructure we need to boost our energy independence, protect billpayers, and become a clean energy superpower.”
How will the funding be allocated?
Industry will now bid for a share of the funding through the Government’s sixth renewable auction, known as the Contracts for Difference scheme.
This scheme provides developers with initial subsidies for clean electricity projects across Britain, with a built-in design to keep costs low for billpayers.
These subsidies are paid back when wholesale electricity prices are higher than the agreed Contract for Difference price.
This was seen over Winter 2022/2023 when Contracts for Difference payments reduced the amount needed to fund government energy support schemes by around £18 per typical household.
The scheme’s design means the central government’s budget will not be impacted. Findings from a Treasury spending audit revealed £22bn of unfunded pledges inherited from the previous government.
Overall, the funding uplift represents more than a 50% increase on the budget previously set in March. It will drive clean energy investment in the UK, support high-quality jobs in industrial heartlands and coastal communities, and protect household bills from volatile fossil fuel prices.
