The UK government is pledging £265m funding each year to support renewable energy production, in the hope of quadrupling British offshore wind production by 2030. For the first time, the government will provide ‘Contracts for Difference’ funding for emerging technologies such as tidal power and floating offshore wind.

The funding is part of the Contracts for Difference scheme, which guarantees energy producers a minimum price for every MWh of electricity they produce. During the fourth iteration of the scheme - details of which were announced this week - the government will try to secure twice the renewable capacity of the previous round, in theory generating more electricity than the previous three rounds (starting in 2014) combined.

In the latest funding round, £200m will go towards supporting offshore wind. The UK has just over 10GW of offshore wind capacity – bearing around 35 per cent of its global capacity – and the government hopes for this to reach 40GW by 2030. Last month, the business secretary Kwasi Kwarteng told the Telegraph on Sunday that, “My understanding is that the point at which we no longer need to keep subsidising [offshore wind] has almost arrived.”

£10m will go towards the category called “established technologies”, such as onshore wind and solar projects in Scotland and Wales, for the first time since 2015. It is hoped that this will encourage 5GW in new capacity.

Some money will go towards newer technologies through the third category, “less-established technologies”. This covers technologies such as tidal power and floating offshore wind, the latter of which will have £24m ringfenced for development.

“The Contracts for Difference scheme has helped the UK become a world leader in clean electricity generation and lowered prices for consumers,” said energy minister Anne-Marie Trevelyan. “The new plans set out today deliver on the Prime Minister’s 10-point plan and will support the next generation of renewable electricity projects needed to power our homes and meet our world-leading climate change targets.”

Businesses bid to become Contract for Difference developers, with those claiming to be able to produce the cheapest energy in each category selected for subsidies.

In August, the WWF reported that, while paying lip service to green investment, the government is currently falling short in green investment by orders of magnitude. The analysis by the environmental charity found that funding equivalent to 0.01 per cent of GDP has been allocated to climate measures in the 2021 budget. The independent Climate Change Committee estimates that annual investment of approximately one per cent of GDP, from both public and private sectors, is needed to deliver the transition to net-zero emissions by 2050. The WWF also warned the government that it is well below target if it wants to meet its target of cutting carbon emissions by 78 per cent by 2035.

Around £145m was originally allocated in the budget for measures designed to tackling climate change, while policies for driving up emissions, such as the fuel duty freeze, equate to over £40bn.