Finance
UK wind power auction secures record capacity in push for net-zero
Published by Global Banking & Finance Review®
Posted on January 14, 2026
3 min readLast updated: January 19, 2026
Global Banking & Finance Review®
Company
Published by Global Banking & Finance Review®
Posted on January 14, 2026
3 min readLast updated: January 19, 2026
UK's latest wind power auction secures record offshore capacity, advancing net-zero goals and attracting significant investment.
By Susanna Twidale
LONDON, Jan 14 (Reuters) - Britain secured a record amount of offshore wind capacity in its latest power auction on Wednesday, with SSE and Germany’s RWE emerging as the biggest winners as the country seeks to largely decarbonise its power sector by 2030.
The auction comes as the government faces growing pressure from opposition parties over the affordability of its climate plan while the country grapples with some of the highest electricity costs in the world.
Offshore wind projects are central to a government strategy to mostly decarbonise the electricity system by 2030 to meet climate targets and reduce reliance on gas, which currently supplies about a quarter of power demand.
Projects with a total capacity of 8.4 gigawatts secured contracts, enough to power around 12 million homes.
"It is a monumental step towards clean power by 2030," Energy Secretary Ed Miliband said in a statement.
Through the auctions, usually held annually, the government invites renewable project developers to bid for government-backed price guarantees for the electricity produced, called Contracts for Difference (CfDs). When wholesale prices fall below a strike price, the government makes up the difference through consumer levies. When they rise above it, generators repay the excess and bills are adjusted accordingly.
PRICES RISE FROM LAST AUCTION
In Wednesday’s seventh auction round, fixed-bottom offshore wind projects secured strike prices averaging 90.91 pounds per megawatt hour in 2024 prices for 20-year contracts, up around 11% from the previous auction held in 2024.
Miliband said the contracts still offered value for money and remained far cheaper than the equivalent cost of new gas-fired power plants.
Alongside the results, the government released updated electricity generation cost data showing that building a new gas plant would cost about 147 pounds/MWh.
The opposition Conservative Party criticised the auction, saying it would lock the country into high electricity prices for decades.
BOOST FOR THE WIND SECTOR
Industry groups hailed the auction as a significant boost for the offshore wind sector, which has faced headwinds after several auctions in Europe failed to attract enough bidders last year.
In the U.S., President Donald Trump has sought to freeze the domestic offshore wind market, though the pressure may ease after a U.S. court this week cleared Denmark’s Orsted to resume work on its nearly completed Revolution Wind project.
"The results of the UK’s record-breaking auction today mean offshore wind is back with a bang," Ben Backwell, CEO of the Global Wind Energy Council, said in an emailed comment.
“The positive round of results also enhances the UK’s status as a destination for investment in offshore wind energy," he said.
The government said the auction would unlock 22 billion pounds of private sector investment.
Winning projects include RWE's Dogger Bank wind farm off the coast of Yorkshire, northern England, and Norfolk Vanguard off eastern England, as well as SSE's Berwick Bank off the coast of Scotland.
($1 = 0.7435 pounds)
(Reporting by Susanna Twidale. Editing by Mark Potter)
Offshore wind power refers to the generation of electricity from wind turbines located in bodies of water, typically oceans or large lakes, which harness wind energy to produce renewable electricity.
Renewable energy projects are initiatives focused on generating energy from natural resources that are replenished over time, such as wind, solar, and hydropower, contributing to sustainability and reducing carbon emissions.
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