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New renewable projects to bring £12bn of private investment

The government has revealed eight renewable energy projects to be supported under its contracts for difference scheme, worth up to £12bn.

Energy secretary Ed Davey said the projects could support up to 8,500 jobs and add 4.5 GW of low-carbon electricity to Britain’s energy mix, by 2020.

Once built, the projects will contribute around 14 per cent of the renewable electricity expected to be added to the UK’s mix over the next six years.

The projects, which include offshore wind farms, coal to biomass conversions and a dedicated biomass plant with combined heat and power, have been awarded CfDs, through which generators and developers receive a fixed strike price for the electricity they produce for 15 years.

The Department of Energy and Climate Change originally received 57 applications.

In December, 16 projects were told that they had provisionally scored above the Phase 2 minimum threshold evaluation criteria after which ten projects were told that they were provisionally within the available budget.

Since then, two projects have withdrawn from the process, while 14 projects submitted binding applications for investment contracts. The successful projects were chosen based on their final score and rank position.

Mr Davey said: “These contracts for major renewable electricity projects mark a new stage in Britain’s green energy investment boom.

“By themselves they will bring green jobs and growth across the UK, but they are a significant part of our efforts to give Britain cleaner and more secure energy.”

CfDs form part of the government’s Electricity Market Reform programme under its recently passed Energy Act.

The contracts aim to give investors the confidence they need to pay the upfront costs of major new infrastructure projects.

Last week the government named the leaders for its low-carbon investment group, which will manage long-term CfDs with electricity generators to incentivise investment in low-carbon generation and will be operational from 1 August 2014.

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