CfD AR8: DESNZ publishes final Allocation Framework and confirms key auction details

The Department for Energy Security & Net Zero (“DESNZ”) has published the final Contract Allocation Framework for Contracts for Difference (“CfD”) Allocation Round 8 (“AR8”), together with the statutory notices (including the Application Window Notice, Pot and Price Notice, Final Clean Industry Bonus ("CIB") Budget Notice, Standard Terms Notice and Contract Framework Notice) and the final AR8 Standard Terms and Conditions. These documents were published on 6 July 2026 (except the Final Budget notice, which was published on 18 July 2026).

This follows DESNZ’s publication in June 2026 of the draft AR8 Allocation Framework and policy response, discussed in our previous legal update. This article addresses the confirmed final positions, as well as the key changes introduced by the July revisions.

Key updates confirmed in the final AR8 documents include:

• Extension of the Anonymised Bid Information regime to Floating Offshore Wind (“FLOW”) and Other Deepwater Offshore Wind (“ODOW”), reversing the draft-stage position.
• Single Strike Price rule for all Phased Offshore Wind CfD Units, including phased FLOW, representing an apparent tightening of flexibility previously described for phased FLOW bids.
• Reversal of the proposed Consumer Price Index (“CPI”) inflation factor reform, with Base Year CPI reverting to the pre-reform (October-based) definition.
• Clarification of Gate 2/Gate 1 connection eligibility for projects below the Transmission Impact Assessment threshold following the Connection and Use of System Code (“CUSC”) modification CMP446.
• Five-pot auction structure confirmed, with separate pots for Solar PV, Onshore Wind, Offshore Wind, FLOW/ODOW, and emerging/less-established technologies.
• An additional Delivery Year for Solar PV, Onshore Wind, Remote Island Wind, FLOW and ODOW.
• Administrative Strike Prices (“ASPs”) frozen at Allocation Round 7 (“AR7”) levels across all technologies, with an ASP for ODOW set at the same level as FLOW.
• Final CIB budget set at £515 million, replacing the initial £200 million budget, with a portion ring-fenced for FLOW proposals.
• Detailed ODOW technology definition now set out in full in the final Contract Allocation Framework.
• Full procedural timings for the qualification, appeal, and Amended Determination processes.
• Indicative AR8 timetable confirmed, with the longest possible timeline scenario (accounting for a full appeals process) running to mid-March 2027.

The key developments are discussed in more detail below.

Anonymised Bid Information: extension to FLOW and ODOW

The key change between the draft and final Allocation Framework is the extension of the Anonymised Bid Information (“ABI”) regime. While the draft extended ABI beyond Offshore Wind to Solar PV and Onshore Wind, including Remote Island Wind, it excluded FLOW and ODOW. The final framework reverses that position, with the ABI regime now applying to FLOW, Offshore Wind, ODOW, Onshore Wind above 5 MW, Remote Island Wind above 5 MW and Solar PV above 5 MW.

This means that applicants for technologies subject to ABI may only submit one sealed bid and may not submit flexible bids. By contrast, applicants for technologies not subject to ABI may submit up to four flexible bids, subject to the detailed requirements in the Allocation Framework. The Delivery Body may send anonymised bid information to the Secretary of State before the auction is held, which, under the final Allocation Framework, must be assured by the auditor and sent no later than seven working days after the sealed bid submission closing date.

For developers of FLOW and ODOW projects, this is a material change. The removal of flexible bids narrows pricing flexibility that appeared to remain available under the June draft framework.

Phased offshore wind bids

The final Allocation Framework also confirms that applications for Phased Offshore Wind CfD Units must include a single Strike Price applying to all phases. This appears to be a more restrictive position than previously expected, which was that phased FLOW projects would be able to specify different Strike Prices for each phase, as under AR7, unlike phased fixed-bottom Offshore Wind.

Following the extension of ABI, phased projects in FLOW and ODOW technologies will now be subject to bid visibility and required to submit a single sealed bid with one Strike Price across all phases.

Reversion of CPI inflation factor

The consultation response published in June stated that the ‘Base Year CPI’ would be redefined as the simple arithmetic mean of all monthly CPI values for 2024. DESNZ has now decided to revert to the previous drafting, under which “Base Year CPI” means the value of CPI for October in the calendar year immediately preceding the Base Year.

DESNZ states that this decision follows stakeholder requests for clarification on the precise CPI value to apply, as well as further consideration of the administrative burden on the Low Carbon Contracts Company (“LCCC”). The U-turn therefore restores a single, readily identifiable CPI reference point for indexation purposes, reducing uncertainty and administrative complexity.

Clarification of connection availability

The draft AR8 Allocation Framework sought to tighten the connections-related eligibility requirements to reflect the National Energy System Operator (“NESO”) connections reform process. The general position is that Gate 1 projects are excluded unless they have Gate 1 Connection Point and Capacity Reservation (“Gate 1 CPCR”), with Gate 2 and Gate 1 CPCR status assessed through Gate 2 to Whole Queue notifications where the applicant is not yet in receipt of a new connection agreement.

The July revisions introduce a targeted clarification to this position. Following Ofgem’s approval of CUSC modification CMP446 (which increases the lower threshold in England and Wales for evaluation of Transmission Impact Assessment), some projects now fall below the relevant Transmission Impact Assessment threshold and were accordingly outside the scope of the Gate 2 to Whole Queue process.

DESNZ has now clarified that where a project has a valid connection agreement and falls below the relevant threshold, the applicant will not also be required to evidence Gate 1 CPCR or Gate 2 status through a Gate 2 to Whole Queue notification alongside its connection agreement, meaning that such projects are less likely to be inadvertently locked out of CfD eligibility.

DESNZ has also indicated that this clarification will apply to AR9 and future allocation rounds, giving projects a more stable basis for planning future CfD applications.

Final pot structure and Delivery Years

The statutory notices confirm that AR8 will be structured across five pots, with an additional Delivery Year added for Solar PV, Onshore Wind, Remote Island Wind, FLOW and ODOW technologies.

Administrative Strike Prices (“ASPs”) 

ASPs for AR8 are confirmed as frozen at AR7 levels across all technologies (expressed in 2024 prices, £/MWh). The ASPs confirmed are:

The budget for the main CfD allocation process will be confirmed after applications have been assessed, with value for money for consumers remaining a key consideration for DESNZ in determining whether, and to what extent, budgets are allocated to particular pots.

Separate clearing prices for offshore wind

The final AR8 documents confirm that separate clearing prices will apply for offshore wind based on where projects connect to the system. The stated rationale is to reduce the risk that material differences in transmission charges lead to significant overcompensation for some projects. The final Allocation Framework requires applicants to confirm whether the project is expected to connect in one of two broad connection categories: broadly, either the more northerly transmission / distribution zones, or the remaining transmission / distribution zones.

Clean Industry Bonus (CIB)

The final CIB budget notice sets a total budget of £515 million for AR8, replacing the initial £200 million budget stated in the statutory notices and with a portion of the budget being ring-fenced for FLOW proposals. The FLOW sub-budget is an undisclosed minimum amount reserved for investment proposals relating to dynamic cables, mooring and anchoring systems, floating substructures and floating assembly and marshalling facilities. Eligible proposals may also draw on the remainder of the CIB budget. The CIB provides additional CfD revenue to projects that meet sustainable supply chain requirements and operates alongside the main CfD allocation process. For more information on the CIB, see our previous legal update: CfD Clean Industry Bonus Scheme Reforms – outcome and implementation.

ODOW: full technology definition

The full technical definition of ODOW has now been confirmed, namely that turbines must be mounted on foundations supported by any combination of buoyancy, a support structure transferring loads to the seabed through a rigid or articulating structure within the water column, and/or slender tensile members or moorings. 

The support structure must not comprise: (a) a monopile with an L/D ratio of less than 18, or a monopile with a seabed penetration depth exceeding 20% of the water depth; (b) a jacket or lattice structure with a base width at the seabed greater than 20 metres; or (c) a continuous gravity base structure with a depth-averaged width greater than 10 metres. The turbines must be situated in offshore waters of at least 50 metres depth (measured from the seabed to chart datum).

This provides materially more technical detail than was available at the draft stage. The fuller definition now gives developers and funders a clearer basis for assessing whether a project qualifies as ODOW, but also makes foundation design, seabed interface and water depth central to CfD classification and bid strategy.

Qualification, appeals and Amended Determinations

The qualification timetable is tightly sequenced, with short windows for applicants to challenge adverse decisions. In summary:

The timetable leaves limited time to assess and challenge an adverse qualification decision. Applicants will need to be ready to review any non-qualification notice promptly and preserve appeal rights within the short working-day windows. Applicants awaiting the outcome of a review or appeal will be treated as Pending Applicants and may submit Pending Bids.

Updated indicative timetable

The indicative timetable published for AR8 is subject to the outcome of any qualification appeals. On the longest timeline, the key milestones are expected to be:

Looking Ahead

The recent change of Prime Minister, Cabinet and Secretary of State for Energy Security and Net Zero introduces a new political context for AR8. However, the overall statutory and policy framework remains in place, and the immediate focus for developers should remain on the final rules and the budget for the main CfD allocation process. The confirmed pot structure, additional Delivery Years and retained AR7 Administrative Strike Prices provide greater clarity, but successful allocation will still depend on the level and distribution of the final budget.

Developers should nevertheless retest key assumptions as the new ministerial team’s priorities become clearer, particularly where these may affect budget decisions. More immediately, bid strategy should be tested against the important changes in the final framework, including the extension of ABI to FLOW and ODOW, the single Strike Price requirement for phased offshore wind projects, the reversion of the CPI methodology and the clarified connection eligibility rules.

AR8 is therefore likely to reward projects that are ready to move quickly and can evidence eligibility cleanly. Budget remains a key allocation risk, but the recent political changes do not of themselves alter the framework or timetable described above.

If you require assistance navigating the AR8 process, assessing project eligibility or developing a bid strategy under the final Allocation Framework, please contact one of the Key Contacts below.