Winds of change on the way for UK renewable energy?

The government has started removing barriers to building new onshore wind farms, but a failure to attract funding bids for new offshore wind has left the clean energy sector far from blown away.

Changes to planning rules from September mean an expansion of onshore wind power is finally back on the cards in the UK after effectively being banned since 2015 despite being one of the cheapest and most popular forms of renewable energy.

Onshore wind on the up?

In theory, it will now be easier for developers and communities to identify suitable locations for onshore wind projects and gain planning permission. In the past, a single complaint from a local resident could scupper a project entirely. The new changes aim to take into account the views of the whole community rather than just a small number of objectors.

Communities backing local wind farms could also benefit from cheaper energy as part of measures to incentivise new projects, which will be set out in full this autumn.

The move should leave the onshore wind sector in its strongest position in years, although industry insiders say the changes announced to-date are far too minor to unleash new developments on a scale comparable to that seen in the offshore wind sector.

Offshore wind on hold?

In contrast, the direction of travel for new offshore wind farms is less clear in the near-term. Offshore wind is the single largest contributor of renewable energy in the UK’s electricity mix and has received significant backing by government in recent years.

However, the latest round of the Contracts for Difference (CfD) scheme – an annual auction where renewable energy developers bid for a guaranteed price for the electricity they generate – failed to attract a single bid from offshore wind developers.

CfD funding has been crucial to the remarkable growth of offshore wind in the UK since the scheme’s introduction in 2014, but the floor price for this year’s auction was set too low to be feasible for any new developments. The result is widely being seen as a significant setback for the UK’s net zero ambitions.

Instead, this year’s funding went to a record number of smaller projects utilising other renewable energy sources. Half of the new electricity capacity secured will be generated by solar power, while double the number of onshore projects received funding compared to 2022. A record 11 tidal power projects also secured funding, as well as three geothermal projects for the first time.

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