Anaerobic digestion and advanced conversion technologies to get bigger part of contracts for difference budget


The Department of Energy & Climate Change has revealed the total budget for the contracts for difference scheme and anaerobic digestion and advanced conversion technologies are among the main beneficiaries.

A total of £205 million per year has been allocated by DECC from 2016/17 to the contracts for difference subsidy and this has been divided into two pots.


The first pot contains established technologies including energy from waste with CHP and landfill gas as well as onshore wind (>5MW), solar photovoltaic (>5MW), hydro (>5MW and <50MW) and sewage gas. This pot will have a total budget of £50 million per year until 2020/21.

But the second pot of less established technologies will have total funding of £155 million per year until 2020/21 and this includes anaerobic digestion, advanced conversion technologies, dedicated biomass with CHP, offshore wind, wave, tidal stream, geothermal and Scottish islands onshore wind.

The Government has decided not to release further budget for biomass conversion.

An initial auction for established technologies of £50 million is also planned for 2015.

Energy Secretary Ed Davey (pictured) said: “Our plan is powering growth and jobs as we build clean, secure electricity infrastructure for the future. By radically reforming the electricity markets, we’re making sure that decarbonising the power sector will come at the lowest possible cost to consumers.

“Average annual investment in renewables has doubled since 2010 – with a record breaking £8 billion worth in 2013.

“These projects will create green jobs and green growth, reduce our reliance on foreign-controlled volatile energy markets and make sure bill payers get the best possible deal. 

“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.”

The Renewable Energy Association said it is surprised that the Government has allocated three times as much budget to less established technologies.

Its chief executive Nina Skorupska said: “The limited funding for several key technologies will send shockwaves through the industry. It’s really important not to lose sight of the bigger picture today. Ultimately all renewables, not just in power but in heating and transport too, are really competing with fossil fuels that are mostly imported from overseas and damage the climate.

“With many people struggling with their energy bills, cost effectiveness is every bit as important, and DECC cannot say that this planned budget delivers value for money for the consumer. The best way to square the circle is by properly funding the cheaper technologies and introducing minima for all technologies.

“This will ensure continued investment, innovation and job creation across all sectors, while also bringing forward cheaper clean power in the short term to address the looming capacity crunch.”