A CONTRACT awarded to a wind farm in the Moray Firth has been welcomed as good news for Scotland's renewables industry, bringing "major economic opportunities" for the supply chain.
The 950MW Moray East offshore wind farm, some 22km off the east coast of Caithness, was awarded a 15-year contract in the Department for Business, Energy and Industrial Strategy's second competitive clean power auction at a price substantially lower than previous auction rounds.
The project is scheduled to start generating power by 2022.
It was one of three UK offshore wind schemes to win a Contract for Difference (CfD) in the auction, which together signalled a considerable drop in the cost of the technology, down 50 per cent since the first auction in February 2015.
Grangemouth Renewable Energy Limited also received a CfD for its dedicated biomass plant, which will be delivered in 2021/22.
Scottish Renewables' deputy chief executive Jenny Hogan said the results of this latest auction were good news for Scotland, for its environment and for its energy system.
"The cost reductions seen in offshore wind in particular have been dramatic and are testament to the determination of developers to drive down costs," she continued.
"The scale of innovation taking place across the sector and its growing supply chain show the importance of ensuring a viable, competitive route to market is available for clean power technologies.
"However, onshore wind and solar are currently excluded from competing in Contracts for Difference auctions. The [UK] Government has the tools to drive down costs even further and these technologies can and should be allowed to play their role in delivering the Government's own industrial strategy.
"We hope to see all renewable technologies getting the chance to bid in future auction rounds and to demonstrate just how cheap they can be."
EDPR and ENGIE are jointly developing Moray East. Consent was granted in 2014 by the Scottish Government for around 100 turbines.
Jo-o Manso Neto, chief executive of EDPR, said: "EDPR's sustained commitment to the UK offshore wind market through electricity market reform and the transition to CfD auctions has enabled dramatic cost reduction from £150/MWh in 2014 to £57.50 /MWh today.
"This auction has demonstrated the real progress in cost reduction and our result shows how affordable offshore wind can be compared with other technologies, including new thermal generation.
"The UK needs more low-carbon generating infrastructure to maintain security of supply against an increasingly uncertain future. EDPR has demonstrated what can be done at this site. It is in the UK's interests to enable us to continue this achievement at other sites."
Wilfrid Petrie, CEO for ENGIE in the UK and Ireland, said: "We are delighted that the Moray East offshore wind farm has received this CfD, which is an important step in taking this project forward. This will be ENGIE's first offshore wind development in the UK, and complements our growing global offshore wind portfolio with projects in France, Portugal and Belgium, as well as our existing renewables operations in the UK.
"ENGIE is committed to investing in sustainable energy solutions and innovative services in the UK, including renewable energy generation. Moray East will make a significant contribution towards helping the UK meet its decarbonisation targets."
Dan Finch, managing director of Moray Offshore Renewables, said: "Moray East's success in this auction will enable us to bring a high-quality, high-value offshore wind project to the UK, and I would like to thank all of the organisations, individuals and communities with an interest in the Moray Firth with whom we have worked to reach this vital milestone.
"Moray East also brings major economic opportunities to our supply chain. Innovation and co-operation have enabled the cost reduction which ensured success in this auction. Electricity from Moray East will be produced at the lowest cost of any offshore wind farm around the UK, with exceptional benefits to consumers."
The chairman of Moray Council's economic development and infrastructure committee, Councillor John Cowe, welcomed the announcement and said Moray was well positioned to benefit from it economically.
"I'm delighted that we have reached another key milestone in this development," he said. "Buckie harbour is ideally placed given its location and facilities to support this massive infrastructure project.
"I look forward to our continued engagement with the developer and supply-chain companies in offering solutions within the harbour and surrounding area that will attract inward investment and, as a result, jobs into the area."
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