The UK Government will award more than £200m annually for renewable energy projects as part of its first auction of contracts in building low-carbon electricity system.
The first auction of contracts-for-difference, to be held place in October, involves deals worth £50m a year available to more established technologies such as solar and onshore wind power.
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The remaining £155m a year will be granted for less established technologies like offshore wind and biomass.
The renewable energy projects to compete for a part of the government’s reforms to the electricity market for reducing emissions from the power sector much more cheaply than through existing policies, around 6% lower on the average domestic electricity bill up to 2030.
UK Energy and Climate Change Secretary Ed Davey said: "Our plan is powering growth and jobs as we build clean, secure electricity infrastructure for the future.
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"By radically reforming the electricity markets, we’re making sure that decarbonising the power sector will come at the lowest possible cost to consumers.
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By GlobalData"Average annual investment in renewables has doubled since 2010 – with a record breaking £8bn worth in 2013. We’re building a secure, low-carbon electricity system that will be the powerhouse of the British economy, supporting up to 250,000 jobs by 2020."
At least a further £50m is planned for an auction around 2015 and a total of approximately £1bn for further projects, including carbon capture and storage, up to 2020-21.
RenewableUK director of policy Gordon Edge said: "Although we appreciate that it’s necessary to hold back budget for future years in order to allow potentially cheaper projects to come forward later, this initial release of the draft budget risks being insufficient to drive industrialisation, competition and cost reduction."
