Success for Great South West geothermal and solar but UK offshore wind farms miss out

1.c (Geothermal Energy)

Image: United Downs Deep Geothermal rig; Geothermal Engineering Ltd.

Geothermal projects in Cornwall have secured contracts awarded by the Government to provide clean energy for the next 15 years, as part of a 320 MW clean energy boost for the Great South West.

Three geothermal energy projects have secured Government support at its renewable energy auction. The Manhay, Penhallow and United Down projects, run by UK-based Geothermal Engineering Limited, are the first Contracts for Difference (CfD) allocated to geothermal energy production in the UK. Contracts run for 15 years and are underwritten by the Government.

On solar, Langford and Peradon Solar Farms near Exeter, Gammaton Solar Farms in North Devon, Enso Green Holdings at North Petherton near Bridgwater and Aller Langport in Somerset, and Rampisham Woods, Fern Brook Solar Farm near Shaftesbury and Galton Manor near Dorchester also received contracts.

It means every county within the Great South West was successful in round five of the Government’s contracts allocation, ensuring 320.88 MW of low carbon energy production for the region. Falmouth-based HydroWing also secured a tidal energy contract for its work in South Wales. 

But no bids were received for any UK offshore wind farm projects, with industry experts blaming the inadequate energy strike price set by the Government. 

Bids for the four 1 GW floating offshore wind projects in the Celtic Sea were not expected, as The Crown Estate has yet to start the leasing process. But the lack of bids in other areas has led to concerns that offshore wind projects elsewhere may struggle to progress, with a potential knock-on impact on the UK’s ability to maintain its world-leading position, attract investment and grow the UK supply chain.

The Great South West is urging the Government to take swift action to ensure the Celtic Sea array and offshore industry developing in the region does not stall.

Karl Tucker, Chair of the Great South West, said: “It’s fantastic news for our geothermal capabilities and it’s great to see low carbon energy production being backed right across the region, but it is a blow for offshore ​​wind generation, which is needed if we are to meet our renewable energy generation targets.

“There is huge potential for the Great South West to become a leading provider of clean energy and that work is well underway. From developing the necessary infrastructure and vital research at our universities, to the skills needed to fulfil job opportunities and the work to bring companies and investment into the region, we are firmly focused on playing our part to help the country achieve its net zero targets.

“It is now vital that the Government reassesses its approach to offshore wind as a matter of urgency, and looks again at setting realistic pricing. This must happen alongside the need to boost National Grid capacity and reviewing planning rules. Considerable progress has been made and we cannot afford to let that slip.”

In last year’s contract round, Hexicon’s TwinHub secured 15-year revenue support for a 32 MW floating wind Celtic Sea project, as part of the Wave Hub demonstration site off Hayle, the first ever dedicated CfD award for floating wind in the UK.

The All Party Parliamentary Group (APPG) for the Celtic Sea, chaired by North Devon MP Selaine Saxby, meets at Westminster on Wednesday and will be briefed by David Ralph, CEO of the Great South West, on the situation. The APPG includes MPs from Cornwall, Devon, Somerset and Wales.

This summer, the Great South West published its Clean Energy Powerhouse Prospectus, revealing that over 500 low carbon energy projects are already operational or in development across the region. The prospectus was developed by Regen, the independent centre of energy expertise.

Grace Millman, Regen’s Offshore Sector Lead, said: “The failure to attract any offshore wind projects to the recent auction round is a blow to the UK’s offshore wind industry, including the exciting floating offshore wind projects being developed in the Celtic Sea. Offshore wind is critical to the country’s energy security and net zero goals, as well as our economy. 

“Regen is calling for urgent action from the UK Government to rebuild industry confidence and set out a clear strategy for delivering new offshore wind projects. There are just two months until the Government is set to outline its proposed framework for next year’s CfD round and it needs to get this right.”

Celtic Sea Power is the Hayle-based company owned by Cornwall Council working to ensure that the benefits of floating offshore wind are realised at a regional level.

Matt Hodson, its Chief Operations Officer, said: “The recent AR5 results have been successful for South-West based business, including an award of 10 MW to HydroWing and the three GEL geothermal projects in Cornwall. These are real successes for renewable energy in the Celtic Sea region which will help scale-up capability in our local SMEs and workforce.

“But there is consternation around the lack of offshore wind projects bidding for contracts in this round. The current administrative strike prices for offshore wind and FLOW are not realistic as the industry faces the challenges of inflation, supply chain crunches and increasing capital costs. 

“Whilst addressing how the CfD might evolve to encourage offshore wind projects back, there is an opportunity to consider how revised pricing might help tackle issues including supply chain resilience, carbon impacts, ‘designing-to-local’, coordination and levelling-up.”

The South West has the potential to become a leading exporter of clean energy, providing 11% of the UK’s low carbon energy by 2035, according to the prospectus. 

The Great South West’s diversity of low carbon energy capacity is unmatched anywhere in the UK, with floating offshore wind in the Celtic Sea, a new nuclear power station in Somerset, geothermal and heating solutions, numerous hydrogen and green fuel production facilities, wave and tidal, onshore wind and solar, utility-scale heat and interconnectors.

Download the Great South West Clean Energy Prospectus.