The UK's renewables sector has asked the Labour Party to increase its renewable auction budget to hundreds of millions to meet the offshore wind targets and the wider goal of decarbonising the grid.

Labour won the British election last week. The party pledged to increase the country's capacity for offshore wind to 55 gigawatts by 2030. This is part of broader climate goals.

Tom Glover, UK country chair at RWE who plans to build new British off-shore wind projects, said that the only way the new government can stay on track is by amending the (auction budget) upwards.

Contracts for Differences (CfDs) are a government-backed mechanism that allows renewable project developers to bid for price guarantees for electricity produced. The budget for the sixth CfD auction this year is 1 billion pounds ($1.28billion), 800 million of which will be allocated for offshore wind.

Nick Hibberd is a markets and economics analyst for industry group Renewable UK. He said that the government needs to increase this pot (offshore wind) by 1.5 billion pounds in order to unlock capital investment, and lower average household bills.

The developers deemed the incentives to be too low, and the fifth auction held in 2023 did not result in any projects being completed. This set back the progress made towards the former Conservative Government's target of 50 GW for 2030.

The auction is the only chance for us to know which projects will be awarded CfDs by 2030. We need to make the most of this opportunity." said Damien Zachlod. EnBW generation UK has a joint venture with BP that builds British offshore wind project.

Ashutosh Padelkar is an associate at the consultancy Aurora. He said that the amount of funds allocated to offshore wind will likely have to double, to between 1.65-1.95billion pounds, to support the 10gigawatts of projects eligible for bidding in the current round.

He said that a similar level of ambition would be needed in the next (seventh round) allocation round, to maintain industry confidence.

The Department for Energy Security and Net Zero in Britain did not respond immediately to a comment request. ($1 = 0.7802 pound) (Reporting and editing by Susanna Fenton; Susanna Twidale)