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The renewable funding package is too low.

Renewable
 The government has been told that a £205 million annual funding package announced yesterday for the next batch of renewable power projects will be insufficient to spur the required investment.

Proposed wind, solar, tidal and geothermal electricity projects are expected to compete in this year’s auction for contracts that guarantee them a fixed price for electricity.

The £205 million budget is the government’s estimate of the maximum subsidies required for the contracts in any year based on its electricity price forecasts.

Renewable UK, the industry body, said: «The budget and parameters set for this year’s auction are too low and too tight to unlock all the potential investment in wind, solar and tidal stream projects which the industry could deliver».

The auction also caps the maximum fixed price developers of each technology can seek. Renewables groups had hoped that these wind and solar caps would increase slightly while remaining well below wholesale prices to reflect surging costs of raw materials and financing, but no such change was made.

Jamie Maule, an analyst at Cornwall Insight, said: «Investors and developers are rightly worried about the government’s cap going into the. If an increase in the return cannot compensate for the high cost of capital, the money will not be enough for projects to be successful. It could act to stifle competition and deter investors and developers from bidding for renewable projects».

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Comments

  1. Barry17 March 2023 at 13:35

    If you really want these projects to happen then you need to invest proper money into them. Of course £205 million is not enough, not right now, with all that's going on in the world.

    ReplyDelete
    Replies
    1. Anton17 March 2023 at 14:08

      I wonder how much would be needed yearly? £300 million? More? It's pretty clear, even to regular people that don't know much about this, that the numbers don't add up at all. Such technology and improvements will cost a decent penny but offer very good returns in time.

      Delete

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