The United Kingdom launched the The eighth round of Contracts for Difference (CfD) allocation , known as Allocation Round 8 or AR8 , is the main mechanism used by the British Government to support new low-carbon power generation plants.
Although the call for proposals includes various renewable energy sources, offshore wind once again takes center stage. Fixed-foundation projects will compete in Group 3, while floating installations will share Group 4 with the new Other Deepwater Offshore Wind (ODOW) category, intended for innovative foundation technologies for depths of at least 50 meters.
The application period began on July 20 and ended on August 7, 2026. Since then, the National Energy System Operator (NESO), responsible for managing the process, has been analyzing whether the submitted initiatives meet the necessary technical, regulatory, and connection conditions to advance to the economic stage.
What are the upcoming deadlines? The first milestone on the agenda will be September 16 , when NESO will announce the results of the eligibility assessment . Rejected developers will be able to request a review and, if the decision stands, appeal to Ofgem.
And here's an important fact: the number and duration of those appeals will determine the rest of the schedule .
In the fastest scenario , without challenges, the submission of sealed bids would take place between October 1 and 7. If the procedure reaches a second-level appeal to Ofgem, that window could shift to the period between December 3 and 9.
The publication of the contract budget and the eventual auction notice are expected between mid-September and November 19. The results could be known from the end of November 2026 to February 2027, depending on which of the five proposed timelines is ultimately implemented.
Unlike the previous round, in which offshore wind was resolved before onshore technologies, AR8 plans to announce all awards simultaneously.
Maximum prices of £113 and £271 per MWh
The Department for Energy Security and Net Zero (DESNZ) maintained the administrative exercise prices at the levels set for AR7, expressed in 2024 values.
Offshore fixed-foundation wind will have a maximum price of £113/MWh. For floating wind farms and ODOW solutions , the limit will be £271/MWh . At 2026 prices, ORE Catapult calculates that these values would be roughly equivalent to £120/MWh and £288/MWh, respectively.
These figures do not constitute guaranteed prices nor do they anticipate the outcome. The Administrative Strike Prices act as ceilings: participants must submit bids equal to or lower than these, and competition will determine the actual value of the contracts.
On PowerPod, TGS 4C's specialized podcast, senior analyst Jordan May anticipated: "We will probably see very similar strike prices to last year ."
According to the expert, a significant reduction in steel, financing, or installation costs has not yet been observed. This combination limits the possibility of a rapid return to the considerably lower values recorded in earlier stages of the British market.
Up to 17.1 GW in competitive conditions
An analysis by ORE Catapult estimates that around 20 offshore wind projects , with a combined capacity of approximately 17.1 GW, could meet the conditions to participate in AR8 .
The final volume of contracts awarded will depend on the government's budget. TGS 4C believes it is possible that the UK will seek to contract approximately 6.3 GW more to meet its 2030 targets, although this is a market estimate and not a confirmed goal for this round.
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For reference, AR7 awarded 8.4 GW of offshore wind, the largest volume ever contracted in a single British tender . Its winning projects included Dogger Bank South, Norfolk Vanguard, Berwick Bank, and Awel and Môr , as well as Erebus and Pentland within the floating segment.
A budget increase of the same magnitude is not necessarily expected for AR8 .
A new competition in deep waters
One of the most significant changes is the addition of Other Deepwater Offshore Wind. This classification opens the CfD regime to hybrid structures that do not fully fit the traditional definitions of fixed or floating foundations.
ODOW projects will have the same maximum price and will compete in the same group as floating wind turbines. This could lead to direct competition between technologies with different levels of maturity, construction methods, and cost structures.
According to ORE Catapult, only three floating projects, totaling approximately 232 MW, are currently eligible to participate in AR8 . Although more than 14 GW of additional capacity are under development, much of that portfolio is still in the planning stages and will be subject to future calls for proposals.
TGS 4C warns that, if the Government does not reserve a minimum capacity for floating technology, ODOW projects could capture the entire Group 4 budget if they submit more competitive bids.
To compensate for the increased construction challenges, AR8 incorporates an additional year for delivery and extends the contractual period following the planned commissioning window for floating projects from 12 to 24 months. The aim is to provide more leeway in the face of manufacturing, installation, and port infrastructure availability challenges.
Market attention will now focus on three decisions : how many projects will pass NESO's assessment, what budget DESNZ will allocate, and whether the final design will protect a specific area for floating wind. Until these decisions are made, the £113/MWh and £271/MWh figures represent only the thresholds within which real competition will begin.
Background to the UK's offshore wind energy allocation (AR7)
In January 2026, the UK's latest offshore wind allocation round (AR7) closed , awarding 8.2 GW of fixed offshore wind projects and almost 200 MW of floating offshore wind projects , making it Europe's largest offshore wind auction to date.
The awarded capacity will supply energy to the equivalent of almost 10 million homes, and it should be noted that AR7 was one of the most competitive offshore auctions ever held in Europe.
A record number of 19 projects, with a total potential capacity of 24 GW, were eligible for the tender.
This healthy competition resulted in reference prices for fixed-fund projects of £91.20/MWh in England and Wales, and £89.49/MWh in Scotland.
With these results, offshore wind energy once again proved to be one of the most cost-effective options for European households and industry.
AR7 prices are approximately 40% lower than those for building and running new gas-fired power plants in the UK (£147/MWh) and almost 30% lower than those for building and running new nuclear power plants in the UK (£124/MWh).
The energy generated by the 8.4 GW of new offshore wind farms will save consumers almost £1.7 billion a year compared to the alternative cost of gas. This is a crucial moment for stability and long-term planning. The UK had experienced a failed auction round in 2023 (AR5), which led to uncertainty and delays.