The UK government has secured a record 7.4 gigawatts (GW) of solar, onshore wind and tidal power in its latest auction for new renewable capacity.
It is the second and final part of the seventh auction round for “contracts for difference” (CfDs), known as AR7a.
In the first part, held in January 2026, the government agreed contracts for a record 8.4GW of new offshore wind capacity.
This makes AR7 the UK’s single-largest auction round overall, with its 14.7GW of new renewable capacity being 50% larger than the previous record set by AR6 in 2024.
In AR7a, 157 solar projects secured contracts to supply electricity for £65 per megawatt hour (MWh) and 28 onshore wind projects were contracted at £72/MWh.
This means they will help cut consumer bills, according to multiple analysts.
Energy secretary Ed Miliband welcomed the outcome of the auction, saying in a statement that the new projects would be “50% cheaper” than new gas:
“These results show once again that clean British power is the right choice for our country, agreeing a price for new onshore wind and solar that is over 50% cheaper than the cost of building and operating new gas”.
In addition to cutting costs, the new projects will help reduce gas imports.
In total, AR7 will cut UK gas demand by around 90 terawatt hours (TWh) per year, enough to cut liquified natural gas (LNG) imports by two-thirds, according to Carbon Brief analysis.
Below, Carbon Brief looks at the seventh auction results for onshore wind, solar and tidal, what they mean energy for bills and the impact of the UK’s target of “clean power by 2030”.
- What happened in the latest UK renewable auction?
- What does the solar and onshore wind auction mean for bills?
- What does it mean for energy security, jobs and investment?
- What does the auction mean for clean power by 2030?
What happened in the latest UK renewable auction?
The latest UK government auction for new renewable capacity is the second and final part of the seventh auction round, known as AR7a.
It secured a record 4.9GW of new solar capacity across 157 projects, as shown in the figure below, as well as 1.3GW of onshore wind across 28 projects.
In addition, four tidal energy projects totalling 21 megawatts (MW) secured contracts, included within “other” in the figure below.
Most of the solar that secured a contract has a capacity of less than 50MW. This is the cut-off point for projects to be approved by the local council. Larger schemes must instead go through the “nationally significant infrastructure project” (NSIP) process, subject to approval by the secretary of state for energy.
For the first time, one 480MW solar project – approved via this NSIP process – won a CfD in AR7a. The West Burton Solar NSIP is being developed in Lincolnshire and Nottinghamshire by Island Green Power. It is named after the grid connection it will use, freed up by the shuttering of the coal-powered West Burton plant.
However, Nick Civetta, project leader at Aurora Energy Research notes on LinkedIn that this site was only one of four eligible solar NSIPs to secure a contract.
Civetta adds that “wrangling these large projects into fruition is proving more painful than expected”.
Solar projects secured a “strike price” of £65/MWh in 2024 prices, some 7% cheaper than the £70/MWh agreed in the previous auction round.
In previous auction rounds CfD contracts were expressed in 2012 prices. For comparison, AR6 and AR7a solar contracts stand at £50/MWh and £47/MWh in 2012 prices, respectively.)
Alongside solar, 28 onshore wind projects secured contracts in the latest CfD auction, with a total capacity of 1.3GW.
This includes the Imerys windfarm in Cornwall, which at nearly 20MW is the largest onshore wind farm in England to secure a contract in a decade.
(Shortly after taking office in 2024, the current Labour government lifted a decade-long de facto ban on onshore wind in England.)
Overall, Scotland still dominated the auction for onshore wind, with 1,093MW of projects in the country in comparison to 38MW in England and 185MW in Wales.
This includes the Sanquhar II windfarm in Dumfries and Galloway in Scotland, which will become the fourth-largest onshore wind farm in the UK at 269MW.
In total, Wales secured contracts for 20 renewables projects in AR7a, with a capacity of more than 530MW. This is the largest ever number of Welsh projects to get backing in a CfD auction, according to a statement from the Welsh government.
Onshore wind secured a strike price of £72/MWh, up slightly from £71/MWh in the previous auction in 2024.
The prices for solar and onshore wind were 13% and 21% below the price cap set by Department of Energy Security and Net Zero (DESNZ) for the auction, respectively.
In its press release announcing the results, the government noted that the results for solar and onshore wind were less than half of the £147/MWh cost of building and operating new gas power stations.
Finally, four tidal energy projects secured contracts with a total capacity of 21MW at a strike price of £265/MWh, up from £240/MWh in 2024.
In total, taken together with the 8.4GW of offshore wind secured in the first part of the auction, AR7 secured a total of 14.7GW of new clean power, as shown in the chart below.
This is enough to power the equivalent of 16 million homes, according to the government. It also makes AR7 the single-largest auction round by far, at more than 50% larger than the previous record set by AR6 in 2024.
This means that the two auction rounds held since the Labour government took office in July 2024 – AR6 and AR7 – have secured a total of 24GW of new renewable capacity. This is more than the 22GW from all previous auction rounds put together.
However, several analysts noted that the AR7a results did not include any old onshore windfarms looking to replace their ageing turbines with new equipment – so-called “repowering projects” – despite the auction being open to them for the first time.
What does the solar and onshore wind auction mean for bills?
Onshore wind and solar are widely recognised as the cheapest sources of new electricity generation in almost every part of the world.
The latest auction shows that the UK is no exception, despite its northerly location.
The prices for onshore wind and solar in the latest auction, at £72/MWh and £65/MWh respectively, are comfortably below recent wholesale power prices, which averaged £81/MWh in 2025 and £92/MWh in January 2026.
This means that the new projects will cut costs for UK electricity consumers, according to multiple analysts commenting on the auction outcome.
The government lauded the results of AR7a for securing “homegrown energy at good value for billpayers – once again proving that clean power is the right choice for energy security and to meet rising electricity demand”.
In a statement, Miliband added:
“By backing solar and onshore wind at scale, we’re driving bills down for good and protecting families, businesses, and our country from the fossil fuel rollercoaster controlled by petrostates and dictators. This is how we take back control of our energy and deliver a new era of energy abundance and independence.”
As noted in Carbon Brief’s coverage of the offshore wind results under AR7 in January, electricity demand is starting to rise as the economy electrifies and many of the UK’s existing power plants are nearing the end of their lives.
Therefore, new sources of electricity generation will be needed, whether from renewables, gas-fired power stations or from other sources.
In his statement, quoted above, Miliband said that the prices for onshore wind and solar were less than half the £147/MWh cost of electricity from new gas-fired power stations.
(This is based on recently published government estimates and assumes that gas plants would only be operating during 30% of hours each year, in line with the current UK fleet.)
Trade association RenewableUK also pointed to the cost of new gas, as well as the £124/MWh cost of the Hinkley C new nuclear plant, in its response to the auction results.
In a statement, Dr Doug Parr, policy director for Greenpeace UK, said:
“These new onshore wind and solar projects will supply energy at less than half the cost of new gas plants. Together with the new offshore wind contracts agreed last month, these cheaper renewables will lower energy bills as they come online.”
Strike prices for solar dropped by 6% compared to last year and while onshore wind prices rose, this was by less than 2% despite a “difficult environment for wind generation”, according to Bertalan Gyenes, consultant at LCP Delta.
In a post on LinkedIn, he noted that “extending the contract length [for onshore wind projects] by five years seems to have helped keep this increase low”.
The January offshore wind round secured 8.4 GW at £91/MWh, as such, the onshore and solar projects are 25% cheaper per unit of generation.
(The offshore wind projects secured in January are nevertheless expected to cut consumer bills relative to the alternative, or at worst to be cost neutral.)
Parr added that while the AR7a auction results “show we’re getting up to speed” ahead of the clean power 2030 target (see below), “an even faster way for the government to make a really big dent in bills would be to change the system that allows gas to set the overall energy price in this country”. He adds:
“That would allow us to unshackle our bills from unreliable petrostates and get off the rollercoaster of volatile gas markets once and for all.”
What does it mean for energy security, jobs and investment?
The onshore wind and solar projects secured in the latest auction round will generate an estimated 9 terawatt hours (TWh) of electricity, according to Carbon Brief analysis.
This is equivalent to roughly 3% of current UK electricity demand.
Combined with the estimated 37TWh from offshore wind secured during the first part of the auction, AR7 projects will be able to generate 46TWh of electricity, 14% of current demand.
If this electricity were to be generated by gas-fired power plants, then it would require around 90TWh of fuel, because much of the energy in the gas is lost during combustion.
This is several times more than the 25TWh of extra gas that could be produced in 2030 if new drilling licenses are issued, according to thinktank the Energy and Climate Intelligence Unit (ECIU). As such, AR7 will significantly cut UK gas imports, ECIU says, reducing exposure to volatile international gas markets.
Furthermore, ECIU says that the impact of renewables in driving down gas demand – and subsequently electricity prices – is already being seen in the UK.
Five years ago, gas was setting the wholesale price of power in the UK 98% of the time due to the way the electricity market operates.
This price-setting dominance is being eroded by renewables, with recent analysis from the UK Energy Research Centre showing that gas set power prices 90% of the time in 2025.
A further effect of new renewables is that they push the most expensive gas-fired power plants out of the system, reducing prices. This is known as the “merit-order effect”.
Recent analysis from ECIU found that large windfarms cut wholesale electricity prices by a third in 2025.
Lucy Dolton, renewable generation lead at Cornwall Insight, said in a statement that the AR7a results will provide a “surge in momentum as [the UK] pushes toward secure, homegrown energy”, adding:
“These investments ultimately strengthen the UK’s position against volatile gas markets. If the past few years have shown us anything, it’s that remaining tied to international energy markets comes with consequences.”
The projects that secured CfDs will help the UK avoid burning significant quantities of gas, “the bulk of which would have been imported at a cost which the UK cannot control”, said RenewableUK in its statement.
Together with previous CfD auction rounds, the latest new renewable projects are expected to generate some 155TWh of electricity once they are all operating, according to Carbon Brief analysis. This is around half of current UK demand.
Generating the same electricity from gas would require some 316TWh of fuel, which is similar to the 339TWh of gas produced by the UK’s North Sea operations in the most recent 12-month period for which data is available. This figure can also be compared with the 130TWh of gas that was imported by ship as liquified natural gas (LNG) in the same period.
The government added that the AR7a projects will support up to 10,000 jobs and bring £5bn in private investment to the UK.
(In total, the new projects secured via AR7 are expected to bring investments worth around £20-23bn to the UK, according to Aurora.)
Additionally, the onshore wind projects are expected to generate over £6.5m in “community benefit” funds for people living near them, according to RenewableUK.
The AR7a results were released alongside the publication of the Local Power Plan by the government and Great British Energy.
This is designed to provide £1bn in funding for communities to own and control their own clean energy projects across the UK.
What does the auction mean for clean power by 2030?
The AR7a results put the UK “on track for its 2030 clean power target”, according to the government.
Over AR6 and AR7, several changes have been made to the CfD process to help facilitate more projects to secure contracts.
A total of 24GW has been secured over the last two auction rounds – which have taken place under the current Labour government – compared to 22GW across the five auction rounds previously.
As part of its goal for clean power to meet 100% of electricity demand by 2030 and to account for at least 95% of electricity generation, the UK government is aiming for 27-29GW of onshore wind and 45-47GW of solar by the end of the decade.
As of September 2025, the UK had 16.3GW of installed onshore wind capacity and more than 21GW of solar capacity. Taken together, the onshore technologies therefore need to double in operational capacity over the next four years to reach the 2030 targets.
Analysis by RenewableUK suggests that the government will need to procure between 3.85GW to 4.85GW of onshore wind in the next two auctions for the 2030 goal to remain possible.
Writing on LinkedIn, Aurora’s Civetta said that the onshore clean power 2030 targets “remain a long way off”.
He continued that the gap for solar to reach its 45-47GW target is still a “whopping 18GW”, but added that there may be other ways for new capacity to be secured, beyond the CfD auctions.
He said these included a growing market for corporate “power purchase agreements” (PPAs), economic incentives for homes and businesses to install solar and the government’s recently released “warm homes plan”, all of which “should drive further procurement”.
Dolton from Cornwall Insight adds that “the challenge now is delivery”, continuing:
“2.5GW of the winners have a delivery year of 2027/28, and over half – 3.7GW – have a delivery year of 2028/29, which brings them very close to the government’s 2030 clean power target.
“Historically, renewable projects in the UK have faced delays, often due to grid connection backlogs and planning holdups. With AR7 and some of AR8 representing the only realistic pipeline for pre-2030 capacity, keeping to schedule will be essential.”
When built, the projects announced today will help to bring the total capacity of CfD-supported wind and solar to 50.6GW, according to Ember.
While solar and onshore wind are expected to play an important role in decarbonising the electricity system, offshore wind is set to be the “backbone”.
The government is targeting 43-50GW of offshore wind by 2030, up from around 17GW of installed capacity today.
This leaves a gap of 27-34GW to the government’s target range.
Prior to the AR7 auction, a further 10GW had already secured CfD contracts, excluding the cancelled Hornsea 4 project.
The 8.4GW secured in January brings the gap to reach the minimum of 43GW over the four years to just 7GW.
The post Q&A: New UK onshore wind and solar is ‘50% cheaper’ than new gas appeared first on Carbon Brief.
Q&A: New UK onshore wind and solar is ‘50% cheaper’ than new gas
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As well as claiming more than 550 lives, the war between the United States and Israel and Iran threatens to inflict severe economic damage across the world, by pushing up the oil, gas and energy prices.
About a fifth of the world’s oil and liquefied natural gas (LNG) passes on ships through the Strait of Hormuz, a narrow stretch of water separating Iran from the Gulf countries.
With Iranian missiles hitting oil and gas sites in the Gulf – including the world’s largest LNG export facility Ras Laffan – and fears that ships may be targeted, Qatar has halted its LNG production and traffic through the Strait has slowed drastically.
The disruption has sent oil and LNG prices surging, raising costs for households and businesses worldwide that rely on fossil fuels for electricity, transport, heating and manufacturing.
In two online briefings – focused on Europe and Asia, respectively – energy analysts warned journalists that prolonged disruption could trigger a global economic crisis. Governments should seek to reduce their reliance on oil and gas – through investments in clean energy and energy efficiency – rather than just seeking non-Gulf oil and gas suppliers, they said.
Seb Kennedy, founding editor of EnergyFlux.News, said the war is “a bonanza for US LNG exporters and a catastrophe for everyone else.” He added that “if this goes on for months and months then [the energy crisis] could be on the scale we saw in 2022”.
Asia hit hardest
Asian economies are expected to bear the brunt as the largest buyers of Qatari LNG. Research by ZeroCarbon Analytics suggests that Japan and South Korea, which get over three-fifths of their energy from oil and gas imports, are among the most vulnerable.
Sam Reynolds, a researcher from the Institute for Energy Economics and Financial Analysis said that Japan’s definition of energy security prioritises diversifying fossil fuel supply over promoting domestic renewables and, while Reynolds said this crisis could change that, he doubts that it will. Both Japan and South Korea are likely to speed up their pursuit of nuclear energy though, he added.
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Several South-East Asian nations – like Vietnam, the Philippines and Thailand – have invested in infrastructure to import LNG over the last few years in an attempt to gain energy security by diversifying supply routes beyond natural gas pipelines.
But ZeroCarbon Analytics researcher Amy Kong said that these countries were “seeing the same problems with new dealers” as “all the cards are held by a few LNG suppliers”. As these countries have huge untapped renewable potential, she said that “clean energy – not LNG – would be the key to avoiding impacts from these crises”.
Khondaker Golam, research director at Bangladesh’s Centre for Policy Dialogue, said Bangladesh’s already strained energy system will come under further pressure. In the short term, the government is likely to ration supply and seek LNG cargoes from outside the Gulf. Over time, however, the crisis could accelerate implementation of the country’s rooftop solar programme and other renewable projects.
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China and India are also reliant on Gulf oil and gas and are now exploring alternative suppliers like Russia and, at least in India’s case, Canada and Norway. Over the longer term, Oxford University energy and climate professor Jan Rosenow said that China is also likely to double down on moving away from oil and gas by promoting electric vehicles, batteries and electrifying industries.
Although Europe imports a smaller share of its energy from the Gulf than Asia, it will not be insulated from price shocks. As Asian buyers compete for LNG cargoes – particularly from the US – gas prices will rise across the world, Kennedy added, with Europe already seeing increases.
Europe suffers too
Rosenow said that he was experiencing “deja vu” from when Russia restricted gas supplies to Europe, sparking a global energy crisis. Following that, he said, Europe had “not really managed to scale up the alternatives fast enough”, adding that “now we pay the price for that”.
He cited the example of Germany, where the government last week weakened requirements for buildings to install electric heat pumps instead of gas boilers. “We [in Europe] just haven’t made enough progress in terms of rolling out heat pumps, decarbonising industry and scaling up electric mobility,” he said.
Some in non-Gulf oil and gas producing countries have argued that this disruption justifies more production. Kennedy said the industry would “do everything it can to make that case”, but warned that new projects must consider demand decades ahead. By then, he said, “this conflict has probably long been forgotten about and we’re on to the next one”.
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In the United Kingdom, the government is under pressure from the right-wing opposition and US President Donald Trump to reverse its ban on licenses for new oil and gas fields in the North Sea.
But business secretary Peter Kyle said the crisis showed the UK must “double down” on renewables to protect its “sovereignty” as the crisis has exposed the country’s reliance on fossil fuels “from parts of the world which are fundamentally unstable”.
“We keep on seeing these lived examples of how instability, through regional instability, is creeping into our energy prices for which the British government has no agency”, he said.
Interest rates stymie renewables
But in the short term and without government policy intervention, Morningstar equity analyst Tancrède Fulop told Climate Home News that the crisis is likely to hold back the development of renewables.
This is because rising inflation from higher energy costs is likely to prompt governments to raise the cost of borrowing, he said. As renewables projects typically require large upfront capital investment, higher borrowing costs can undermine profitability.
Gas-fired power plants, by contrast, typically require lower initial investment than solar, wind or hydro, but higher operating costs over time, as fuel must be continuously purchased.
“What we saw between 2022 and 2024 with high inflation, high gas and power prices – a bit similar to today – renewable companies materially underperformed because of those high interest rates,” he said, “so all in all it won’t be as simple as oil and gas prices are surging so it’s good for renewables”.
The post Gulf oil and gas crisis sparks calls for renewable investment appeared first on Climate Home News.
Gulf oil and gas crisis sparks calls for renewable investment
The United States is set to quit the world’s landmark climate convention next February, after the Trump administration formally notified the UN of its previously announced decision to withdraw.
UN Secretary-General António Guterres communicated last Friday that the UN treaty depository had received Washington’s formal notice to leave the UN Framework Convention on Climate Change (UNFCCC).
Adopted in 1992 at the Rio Earth Summit, the climate treaty is the cornerstone of global efforts to curb climate change and tackle its impacts.
The US withdrawal will take effect on 27 February 2027 – one year after the formal notification – as required by the terms of the convention.
The US, the world’s second-largest emitter, will be the first nation to formally exit the treaty and the only one recognised by the UN outside of it.
‘Colossal own goal’
In January, President Donald Trump, who has called climate change a “con job”, announced his administration’s intention to quit the UNFCCC and 65 other international organisations and instruments, including the Intergovernmental Panel on Climate Change (IPCC), the most authoritative global voice on climate science, and the Green Climate Fund (GCF), the world’s largest multilateral climate fund.
A White House factsheet said President Trump was ending US participation in international organisations that “undermine America’s independence and waste taxpayer dollars on ineffective or hostile agendas”.
“Many of these bodies promote radical climate policies, global governance, and ideological programmes that conflict with US sovereignty and economic strength,” it added.
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At the time, the UNFCCC chief Simon Stiell called the US decision to leave the convention “a colossal own goal which will leave the US less secure and less prosperous”.
“While all other nations are stepping forward together, this latest step back from global leadership, climate cooperation and science can only harm the US economy, jobs and living standards, as wildfires, floods, mega-storms and droughts get rapidly worse,” he added.
Relinquishing obligations
At the end of January 2026, the US already formally left the Paris Agreement, under which countries agreed in 2015 to try to limit global warming to “well below” 2 degrees Celsius above pre-industrial levels and to issue regular emissions-reduction plans. Trump pulled the US out of the accord in 2020 before President Biden re-joined it in 2021.
While the Trump administration had effectively already disengaged from global climate action immediately after its inauguration, its formal departure from the UNFCCC will free it from formal obligations, including reporting detailed greenhouse gas emissions inventories and providing funding for the convention.
The US already stopped funding the UNFCCC and failed to submit its emissions data last year. The federal administration also sent no delegates to the COP30 summit in Brazil last November.
Washington remains involved in other international negotiations with climate implications – including talks on a UN treaty to curb plastics pollution and efforts to price emissions in the shipping sector – where it has sought to slow progress and block binding global measures.
A route back in?
The US could potentially rejoin the UNFCCC in future, likely under a different administration, but there are different views on how complicated that process would be.
The US Senate ratified the UN climate convention – with no opposition – in 1992 and some experts believe a future president could rejoin the UNFCCC within 90 days of a formal decision based on the original “advice and consent” of the Senate.
But other legal experts told Carbon Brief that theory has never been tested in court and a new two-third majority vote in the Senate might be required, which would be challenging with the vast majority of Republican Senators currently opposed to membership.
The post US set to exit UN climate convention in February 2027 appeared first on Climate Home News.
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