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UK Awards Record 4.9 GW Solar Capacity in Latest CfD Auction Round

The UK Department for Energy Security & Net Zero has concluded Allocation Round 7 (AR7) of its Contracts for Difference (CfD) scheme, awarding a record 4.9 GW of solar capacity across 157 projects.

In addition to solar, the round also allocated capacity to other renewable technologies. Onshore wind secured 1.3 GW from 28 projects, while tidal stream projects were awarded 20.9 MW across four developments.

When combined with the 8.4 GW of offshore wind capacity awarded earlier in January through 12 projects, the total clean energy capacity contracted under the recent auction rounds now stands at 14.7 GW.

Competitive Pricing Against Fossil Fuels
The AR7 results underscore the growing cost advantage of renewable energy over conventional fossil-fuel generation.

• Solar projects cleared at an average price of £65.23 (~$88.99)/MWh (2024 prices)
• Onshore wind projects cleared at £72.24 (~$98.56)/MWh

These tariffs are significantly lower than the estimated £147 (~$200.53)/MWh cost of generating electricity from new combined-cycle gas turbine (CCGT) plants operating at a 30% load factor.

Government estimates indicate that the onshore wind clearing price is approximately 51?low the levelized cost of electricity (LCOE) for gas-based generation, while solar projects are about 56% cheaper under comparable assumptions.

Looking ahead to projects expected to come online by 2030, projected LCOEs are estimated at:

• £58 (~$79.12)/MWh for onshore wind
• £60 (~$81.85)/MWh for large-scale solar
• Compared to £147 (~$200.53)/MWh for gas-fired power

Investment and Major Projects
The AR7 round is anticipated to mobilize nearly £5 billion (~$6.82 billion) in private investment throughout the UK’s clean energy value chain.

Among the notable wind projects awarded contracts are:

• Imerys Wind Farm in Cornwall, England
• Sanquhar II Wind Farm in Dumfries and Galloway, Scotland

In the solar category, the West Burton Solar Farm in England secured a CfD contract as a Nationally Significant Infrastructure Project. Located at the site of the former West Burton coal-fired power station, it is now the largest solar facility to receive a UK government renewable energy contract.

Role of the CfD Program
The Contracts for Difference mechanism remains the UK’s primary policy instrument to accelerate low-carbon power generation. The program offers long-term price certainty to developers, helping reduce financing costs and shield projects from wholesale electricity market volatility, while driving investment in renewable energy infrastructure.

Through AR7, the UK has marked its largest clean energy procurement round to date, reinforcing its transition toward a low-carbon electricity system.