Offshore Wind Worldwide Regulatory Framework in Selected Countries 5th Edition 2024 - Flipbook - Page 347
Offshore Wind Worldwide 2024
Under the ROC structure:
•
•
offshore wind generators sell their power
under a long-term power purchase agreement; and
the generators will sell the ROCs they
receive for the generation of accredited
renewable power to suppliers or ROC
traders.
4.2 Consequences of a project delay
See section 2.4 above for an overview of
the consequences of delay under the CfD
regime.
4.3 CfD and Investment Contract pricing
The level of support offered to offshore
wind contracts under the Investment
Contracts and CfDs awarded to date is as
follows:
•
•
•
•
•
•
•
bilaterally negotiated Investment Contracts (April 2014): £140 – 155 / MWh
(2012 prices)
CfD auction 1 (February 2015): £114.39 £119.89 / MWh (2012 prices)
CfD auction 2 (September 2017): £57.50 £74.75 / MWh (2012 prices)
CfD auction 3 (September 2019): £39.65 £41.61 / MWh (2012 prices)
CfD auction 4 (July 2022): £37.35 / MWh
(2012 prices)
CfD auction 5 (July 2023): N/A
CfD auction 6 (September 2024): £58.87 /
MWh (2012 prices)
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5. GRID AND GRID
CONNECTION
5.1 Legal framework for the connection
to the onshore grid and the establishment of the grid connection
An offshore wind farm in England and Wales
will most likely connect to the Great Britain
electricity transmission system operated by
National Grid. The National Grid is required
to make a connection offer to anyone wishing to connect to its transmission system,
but the developer must apply for the connection. The developer must then enter into
a bilateral connection agreement (“BCA”)
with National Grid and a construction agreement (“CONSAG”).
European Union (EU) requirements under
the so called Third Energy Directive require
that the ownership of transmission and
generation assets be unbundled. The UK
has established an offshore transmission
owner (“OFTO”) regime, run by Ofgem,
which creates a competitive tender process
through which offshore transmission licences are granted to ensure that offshore wind
projects are economically and efficiently
connected to Britain’s electricity grid.
To date, OFTO tenders have been run under
the ‘generator build’ model, where the
generator finances and constructs the offshore wind transmission assets (alongside
the construction of the wind farm) before
transferring (‘unbundling’ those assets to
an OFTO for the operational period. Ofgem
is also developing an ‘OFTO build’ model,
where Ofgem runs a tender to appoint an
OFTO with responsibility for constructing
