GLASGOW — The U.K.’s contracts for difference program for offshore wind would seem by most measures to be working very well.
Over the past decade, contracts for difference have supported 10 gigawatts of offshore wind deployment, including 5.5 gigawatts in last year’s round, while driving prices to subsidy-free levels. The CFD program is now being replicated in emerging renewables markets.
As the next two-year cycle begins, the U.K. government is set to launch a consultation on possible changes for the CFD auction round in 2021. But with a net zero by 2050 target in place and a 40-gigawatt offshore wind target for 2040, there are calls for a more radical overhaul of the program.