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Extra £25m CfD funding for 'less established technologies'

A last minute additional £25m funding for the Contracts for Difference (CfDs) auctions has been made available by the Energy Department following high levels of demand for contracts.

Auctions under the new CfDs scheme, which fully takes over from Renewable Obligation Certificates (ROCs) in 2017, start tomorrow (29 January) and aim to make only the most competitive energy projects receive subsidies.

The Department for Energy and Climate Change (DECC) has increased the original £300m funding to £325m to help “less established technologies”.

These include the following energy-from-waste technologies:

  • anaerobic digestion
  • dedicated biomass wood CHP
  • gasification and pyrolysis.

The 2015 CfD budget is split between technology categories, enabling both established (solar pv and wind) and less established technologies to access support.

There is £260m available for less established projects.

DECC claimed this will help to bring forward a diverse mix of low carbon options to help build a new generation of clean, reliable electricity supplies.

It is the second time in three months that DECC has increased the budget for the CfD scheme. In October it added:

  • £15m for established technologies
  • £80m for less established technologies

DECC said further funding is planned to be available for CfDs for renewables and carbon capture and storage in future, rising to over £1bn in 2020-21.

Energy and climate change secretary Edward Davey said: “The high demand for contracts shows that we’re one of the top places for renewables investment.

“Renewable electricity generation and investment have both more than doubled since 2010. We attracted a record breaking £10bn worth of investment in 2014 and by making projects compete for support, we’re ensuring consumers get the best possible deal as well as a secure and clean power sector.”

Renewable Energy Association policy analyst Frank Gordon said: “We welcome an increase in the CfD budget, and await with interest the outcome of the first allocation round.

“However, there remain concerns around CfD policy particularly for independent generators and other established and cost effective technologies such as solar and biomass which must be addressed by the next Government following the election.”

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