Government and Policy News

UK auction secures six more tidal stream projects, totaling 28 MW

AR6 is the third consecutive renewable auction with a ringfence for tidal stream energy. With the results of this year’s auction the UK is on track to have over 130MW of tidal stream capacity deployed in its waters by 2029.
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UK auction secures six more tidal stream projects, totaling 28 MW

The results of Allocation Round 6 (AR6) of the UK’s Contracts for Difference renewable auction were announced, with six projects across five sites securing contracts to deliver 28 MW of tidal stream capacity at £172/MWh (US$225).

AR6 is the third consecutive renewable auction with a ringfence for tidal stream energy. With the results of this year’s auction, the UK is on track to have over 130 MW of tidal stream capacity deployed in its waters by 2029.

The strike price represents a 34% saving against the Administrative Strike Price and is the lowest cost that tidal stream projects have been contracted at since the introduction of the ringfence.

The results are available here, and the projects that secured contracts in AR6 are:

  • HydroWing – 10 MW in Wales
  • MeyGen – 9 MW in Scotland
  • Seastar – 4 MW in Scotland
  • Magallanes – 3 MW in Scotland
  • Ocean Star Tidal – 2 MW in Scotland

Scotland now has 83 MW and Wales has 38 MW of contracted tidal stream capacity in the UK’s renewable auctions. There has still not been a successful tidal stream project contracted in England, the UK Marine Energy Council (MEC) said.

The UK has over 11 GW of accessible tidal stream capacity, which when harnessed could provide over 11% of its electricity demand, MEC said. Projects are being deployed with over 80% UK supply chain content spend.

The UK Government increased the ringfence to £15 million ($19.6 million) in this year’s renewable auction, and the MEC called on the government to maintain the ringfence in future rounds, increase the amount to £30 million ($39.3 million), and set a 1 GW deployment target for 2035.

“These results represent an important step forward for the tidal stream industry,” said Richard Arnold, policy director of the MEC. “These projects will provide entirely predictable renewable energy and a critical service to the UK energy system.”

Last year, the UK’s Environmental Audit Committee released a report, Accelerating the transition from fossil fuels and securing energy supplies, that scrutinized the government’s British Energy Security Strategy and its policies on oil and gas extraction on the UK Continental Shelf.

Regarding tidal energy, the report said the strategy “neglected … promising renewable technologies, such as tidal power, that had the potential to provide predictable and clean power supplies at certain locations on the UK’s coastline.” On the potential of tidal power, the report said that tidal stream and tidal range technology could contribute to the UK’s energy security and net zero goals. However, in the past, securing generating capacity from tidal range installations has been deemed too expensive or too environmentally damaging.

Recent developments have increased energy outputs to the extent that tidal range is now of similar cost to nuclear and offshore wind once whole life costs — such as inflation, interconnection and intermittency — are included. However, tidal energy may be a niche opportunity given limited sites with advantaged geography and is a prospect for the medium term, with onshore wind and solar being faster and cheaper.

The UK has abundant tidal energy resources, and tidal flows are “entirely predictable and can therefore deliver a consistently reliable year-round source of clean electricity,” the report said.