Slim pickings for solar in UK renewables auction

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Just five solar projects totalling 72MW have won contracts in a UK government auction in which PV competed with other renewable energy technologies for the initial time.The Department for Energy and Climate Change this morning unveiled the 27 winning projects within the initially contracts for difference (CfD) auction, under which the most competitive bids receive 15-year contracts at a guaranteed ‘strike price’.

For UK solar projects over 5MW, CfDs will be the only form of support available following 31 March this year, following a government decision to limit the renewable obligation (RO) mechanismto projects under this size. The RO has been largely responsible for the UK’s recent boom in large-scale solar and helped make it Europe's largest solar end market place final year.

In total contracts for over 2GW of renewable energy capacity were awarded in the CfD auction, with offshore wind the biggest winner with 1.1GW.Solar was directly competing with onshore wind inside the 'established' pool in the auction. Inside the pool of 'less etablished' technologies were offshore wind, energy from waste and advanced conversion technologies.

The five solar successful projects ranged from 12 to nearly 20MW in size. Details are as follows:Project nameDeveloperMWStrike price (?/MWh)Delivery yearWick Farm Solar ParkHadstone Energy19.1502015-16Charity FarmLightsource14.6779.232016-17Royston Solar FarmRoyston Solar Farm Ltd13.78502015-16Netley Landfill SolarREG Netley Solar1279.232016-17Triangle Farm Solar ParkCambridgeshire County Council1279.232016-17Two in the projects bid by some margin the lowest strike price of any in the successful bidders within the auction, of?50/MWh. This is significantly less than the strike price of?92.50 promised by the government to French firm EDF for power from a new nuclear plant at Hinkley Point.

The average strike price for all projects within the auction was around?85.75.Ray Noble, solar consultant to the UK’s Renewable Energy Association (REA) welcomed the fact that solar had shown it could compete."No one knows how many projects have been submitted of each technology so it is difficult to analyse but it looks like solar is giving a warning to the others for Round two [of CfDs] with the lowest strike price of?50," he said.But doubts are already being raised about the possibility of?50/MWh solar being viable inside the UK with the Solar Trade Association (STA) saying it would be "amazed" if those projects could be built."As we warned, solar has only been able to win a tiny amount of CfD contracts. This is very disappointing," stated STA CEO Paul Barwell. "

The soon-to-be-cheapest and most popular renewable -solar power -has lost out in a complex auction that really suits big players. We are expecting a considerable drop within the solar market this year. It's really important that changes are produced towards the next round of CfD auctioning in October to ensure SMEs can compete -and that energy policy generally takes better care of your UK solar industry.

We're not asking for special treatment, just a more level playing field."UK energy secretary Ed Davey mentioned: "This world top auction has delivered contracts for renewables projects right across the UK. These projects could power 1.four million homes, create thousands of green jobs and give a massive increase to home-grown energy though reducing our reliance on volatile foreign markets."The auction has driven down prices and secured the best possible deal for this new clean, green energy."The complete list of winning projects is available here.Additional reporting by John Parnell and Peter Bennett.

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