Government support for marine renewables

What are marine renewables?

The term “marine renewables” is commonly used to refer to technologies that harness energy from the sea to generate electricity. This could be from waves, tidal streams and tidal ranges, for example. It is sometimes used more broadly to include any renewable technology that operates at sea and which requires access to offshore electricity networks, including offshore wind.

Marine renewables in the UK

Offshore wind capacity grew rapidly between 2010 to 2020 and produced 13% of all UK power generation in 2020.

Electricity generation from offshore wind fell in 2021 due to lower wind speeds. By the end of the second quarter of 2022 offshore wind capacity had increased.

Wave and tidal power increased little over this period and its contribution to UK generation was less than 0.01% in each year.

At the end of September 2022, three tidal energy projects in the UK had received planning permission. They have a total capacity of 97 megawatts (MW) and all are in Scotland. Around 7,300 MW of offshore wind generation was under construction at the same time.

Government policy on marine renewables

The Government held a call for evidence on the potential of innovative marine energy projects in Great Britain, such as floating offshore wind (wind turbines moored to the seabed in deeper waters), tidal stream and wave energy, in 2020.

This sought views on options to grow these industries while reducing the costs of these early-stage technologies. The Government has not yet published a response to the call for evidence.  

The most recent update to the UK Government’s offshore wind policy came in the April 2022 British energy security strategy. Here the Government set out new targets for offshore wind generation, increasing its previous goal (to increase offshore wind capacity to 40 gigawatts (GW), with 1 GW floating wind power by 2030), to 50 GW of offshore wind by 2030, including up to 5 GW  floating wind. This built upon the Net Zero Strategy in 2021, the 10 point plan for a green industrial revolution in 2020, and the Offshore wind: Sector Deal in 2019.

Incentives and support

The Government’s primary way of supporting new low carbon power infrastructure is the contract for difference (CfD) scheme.

CfDs work by guaranteeing a set price for electricity (known as a strike price)  that generators receive per unit of power output. As the wholesale price of electricity fluctuates, the generator is either paid a subsidy, or pays back, so that they always receive the value of the strike price. The cost, or benefit, is passed on to consumer bills.

The Government changed the way that offshore wind and tidal stream technologies compete for funding in the fourth allocation round of the CfD scheme, held over 2021-2022. This led to floating offshore wind and tidal stream being awarded CfDs for the first time.

The Government’s Floating Offshore Wind (FOW) Demonstration Programme was announced in January 2022. It included over £31 million of UK government funding being matched by more than £30 million of industry funding to develop floating offshore wind technologies. A total of 11 projects have been awarded funding under this scheme.

Further reading

The following briefings from the Commons Library and the Parliamentary Office of Science and Technology (POST) provide background on these technologies:

• POST Note on Marine renewables (June 2020)
• POST Note on Developments in wind power (May 2019)
• Commons Library Delivery of floating offshore wind projects (debate pack, October 2022)
• Commons Library Tidal lagoons (June 2018)