Danish offshore wind firm DONG Energy (DENERG.CO) was awarded a contract to build 1.4 gigawatt (GW) capacity at its Hornsea 2 wind power project during a British auction for renewables, creating the world’s largest offshore wind farm.

DONG said the guaranteed price for the power it will supply was set at a 57.50 pounds per megawatt hour (MWh), 50 percent lower than the allocations at auction two years ago.

Cumulative installed wind capacity
Image: REWE

As part of reforms to its electricity market, Britain replaced direct subsidies for renewable power with a contracts-for-difference (CfD) system.

Under the scheme, qualifying projects are guaranteed a minimum price at which they can sell electricity and renewable power generators bid for CfD contracts in a round of auctions.

DONG is already building the Hornsea 1 project wind farm project, with capacity for 1.2 GW. That project was guaranteed a price of 140 pounds per MWh in 2014.

“Hornsea Project 2 will contribute significantly to DONG Energy’s ambition of reaching a total offshore wind capacity of 11-12GW by 2025,” DONG said in a statement.

With the addition of the second phase, the Hornsea project will become the world’s largest offshore wind farm.