The UK government has announced a record-breaking £1.5 billion budget for the next renewable energy auction
The substantial increase, which represents a more than 50% boost over previous budgets, aims to accelerate the UK’s transition to clean, affordable, and homegrown energy.
The funding, announced by Energy Secretary Ed Miliband on Wednesday, July 31, shows the government’s commitment to positioning the UK as a global leader in green technology.
The majority of the budget, £1.1 billion, will be dedicated to offshore wind, the backbone of the UK’s clean energy strategy. This figure is more than the total budget of all previous auctions combined, sending a strong message to the renewable energy industry to invest in UK waters.
Renewable energy auction
The sixth renewable energy auction, part of the Contracts for Difference (CfD) scheme, will allow developers to bid for funding to deliver new renewable energy projects across Britain.
The CfD scheme guarantees developers a set price for the electricity they generate, providing them with the certainty needed to invest in new technologies. This design also benefits consumers, as the guaranteed price helps keep energy bills stable even when wholesale prices fluctuate.
The budget increase comes as the UK faces rising energy costs and an urgent need to reduce its dependence on volatile global gas markets.
Achieving Net Zero by 2050
Investing in renewable energy is seen as a key strategy to protect households from future price spikes, while also contributing to the government’s goal of achieving net zero emissions by 2050.
In addition to the £1.1 billion earmarked for offshore wind, the budget includes £185 million for established technologies like onshore wind and solar, and £270 million for emerging technologies such as floating offshore wind and tidal energy.
The announcement coincides with the first meeting of the Clean Energy Mission Board, chaired by the Energy Secretary, which will oversee the government’s mission to deliver clean power by 2030.
The increased budget for Allocation Round 6 (AR6) is expected to drive significant investment in the UK’s renewable energy sector, creating high-quality jobs and boosting economic growth in industrial heartlands and coastal communities across the country.
