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Offshore wind power projects are to get bigger subsidies as ministers scramble to get the industry building again.
Claire Coutinho, the Energy Secretary, will on Thursday announce a near 70pc increase to the guaranteed price offered to developers, after warnings that low subsidies would kill off a string of major schemes.
The move follows the embarrassing flop of the most recent subsidies auction over the summer, which attracted no bids from offshore wind developers and triggered an angry backlash against the Government.
Companies including RWE, Vattenfall and Orsted all criticised the price offered in this year’s contracts for difference auction, complaining it was far too low given the surging costs their industry is facing.
Executives have warned that a failure to maintain a pipeline of projects will put the Government at risk of missing its target for 50 gigawatts of capacity by 2030.
Prices awarded in last year’s auction are also causing problems, with Vattenfall’s Norfolk Boreas shelved and Orsted’s Hornsea 3 scheme hanging in the balance.
Ms Coutinho has now increased the strike price offered in next year’s auction round by 66pc, from £44 per megawatt hour to £73. Offshore wind projects will also have their own dedicated cash pot, rather than having to compete with cheaper onshore wind and solar projects.
Ms Coutinho said: “We recognise that there have been global challenges in this sector and our new annual auction allows us to reflect this.
“This is a vital part of our plan to have enough homegrown clean energy, bringing bills down for families and strengthening our energy independence.”
Tom Glover, RWE’s UK chairman, welcomed the move as a “positive step”. He previously called for a 70pc rise in prices.
Dan McGrail, chief executive of industry group RenewableUK, added: “With intense international competition for investment in renewables, we welcome the strong commitment to the sector shown by Government today, which demonstrates that the UK is intent on remaining a global leader in offshore wind, as well as innovative technologies like floating wind and tidal stream.
“There is the potential for the Government to attract a record level of private investment in offshore wind projects next year.”