Household energy bills increased by 54% in April 2022 and were due to increase by a further 80% in October. The new Energy Price Guarantee will limit the October increase to 27%, with a further increase of 20% in April 2023.
Floating offshore wind in the Energy Security Strategy
Spikes in global wholesale gas prices, the failure of energy suppliers, Ofgem’s price cap rise and the Russian invasion of Ukraine, have led to growing concern over security, affordability, and sustainability of energy supplies. In response to these concerns, the Government published its British Energy Security Strategy in April 2022, proposing to accelerate the UK towards a low-carbon, energy independent future.
On offshore wind capacity, the Energy Security Strategy announced updated targets for offshore wind, increasing them to 50 GW (previously 40GW in the Net Zero Strategy), and up to 5 GW floating offshore wind (previously 1GW) by 2030. To help achieve this, the Government announced plans to speed up the consenting process for offshore wind developments, which include:
- reducing consent time from up to four years down to one year.
- strengthening the Renewable National Policy Statements to reflect the importance of energy security and net zero
- making environmental considerations at a more strategic level allowing us to speed up the process while improving the marine environment
- introducing strategic compensation environmental measures, including for projects already in the system, to offset environmental effects and reduce delays to projects
- reviewing the way in which the Habitats Regulations Assessments are carried out for all projects making applications from late 2023 to maintain valued protection for wildlife, whilst reducing reams of paperwork
- implementing a new Offshore Wind Environmental Improvement Package including an industry-funded Marine Recovery Fund and nature-based design standards to accelerate deployment whilst enhancing the marine environment
- working with the Offshore Wind Acceleration Task Force; a group of industry experts brought together to work with government, Ofgem and National Grid on further cutting the timeline
- establishing a fast track consenting route for priority cases where quality standards are met, by amending Planning Act 2008 so that the relevant Secretary of State can set shorter examination timescales
Contracts for Difference support
Contracts for Difference (CfD) is a scheme used to support low carbon power infrastructure. Introduced in 2010, CfDs work by fixing the prices received by low carbon generation over a number of years, reducing the risks developers face from a fluctuating wholesale power price, and ensuring that eligible technology receives a price for generated power that supports investment. For more information about CfDs, including how they are decided, see pages 2 and 3 of our briefing Support for low carbon power (April 2020).
In a PQ answer (PQ 36819) on 22 July 2022, the Department for Business, Energy and Industrial Strategy said that:
The Contracts for Difference (CfD) scheme is the Government’s main mechanism for supporting large scale renewable projects. The latest round of the Contracts for Difference, AR4 (Allocation Round 4), delivered almost 11GW of new renewable capacity, almost double the last round in 2019. Technologies like tidal and floating offshore wind were included for the first time ever and more new contracts have been awarded than in any previous rounds. In February, the Government announced the CfD auctions will be held annually, rather than every two years. This will help to further increase renewable energy deployment.
Offshore wind research
A Future Offshore Wind Scenarios Project, Finding space for offshore wind, was led by the Department for Business, Energy & Industrial Strategy (BEIS), the Crown Estate and Crown Estate Scotland, along with a number of consultancy firms. It assessed the different areas that could potentially accommodate future offshore wind projects up to 2050, and the different forms that development could take, for example using a fixed or floating wind farm design. The study looked at different factors, such as cost, the environment and technology, as well as the impact these have on deployment. The project started in February 2021 and a report was published in May 2022, Future Offshore Wind Scenarios (FOWS) to 2050. The study outcomes do not present a plan or recommendation for the future spatial development of offshore wind, but includes 190 different final models based on different assumptions and permutations that can be accessed through an interactive dashboard at www.futureoffshorewindscenarios.co.uk
- Marine Scotland, Marine Scotland’s Sectoral Plan for Offshore Wind, October 2020.
- The Scottish Marine Energy Research (ScotMER) programme – This has been established by Marine Scotland to improve understanding and assess the environmental and socio-economic implications of offshore renewable developments.
- Defra, the Northern Ireland Executive, the Scottish Government and the Welsh Government, UK Marine Strategy Part Three: Programme of Measures consultation, 6 September 2021; highlights related work on offshore wind in relation to habitats, species and conservation.
- Offshore Renewable Energy Catapult document, Economic Value of Offshore Wind (March 2017) provides summary of main areas of offshore wind supply chains (turbine, cables, foundations, substations, installation and maintenance) and the extent to which each is supplied from the UK.
- The Offshore Renewable Energy Catapult and the Crown Estate, Guide to an offshore wind farm (January 2019) – provides a detailed description of components and services involved in development of an offshore wind farm and names of suppliers for each part.
- Offshore Wind Industry Council Offshore Wind Industry prospectus (October 2018) – discusses strengths and opportunities for UK offshore wind industry and informed development of the Sector Deal.
- Tivy-side Advertiser, 13 October 2022:
- Institution of Mechanical Engineers, 12 October 2022:
- Crown Estate, 10 October 2022:
- Reuters, 5 October 2022:
This briefing provides a guide to reliable sources of information to help answer common questions on new government support for energy bills introduced in 2022.
This briefing paper provides information on the Electricity and Gas Transmission (Compensation) Bill, introduced in the House of Commons by Dr Liam Fox as a Private Member’s Bill on 25 November 2022.