Offshore wind developers have a new compliance route from 17 December 2025. The Marine Recovery Funds Regulations 2025, signed by DEFRA minister Emma Hardy on 24 November and laid before Parliament on 25 November, allow payments into central funds to meet compensation conditions attached to consents under the Energy Act 2023, according to legislation.gov.uk.

The Secretary of State can establish one or more Marine Recovery Funds (MRFs) for the whole UK or for specific territories. Funds may cover activities within an English, Scottish, Welsh or Northern Irish inshore or offshore region-or outside those waters if appropriate. Government will operate and manage the funds directly or delegate to devolved public authorities with their consent.

Crucially for planners, only ‘approved measures’ can be funded. These are measures that compensate for adverse environmental effects of relevant offshore wind activities as defined in the Energy Act 2023. Approvals can be time‑limited or geographically constrained, and the Secretary of State must publish a list of approved measures. Measures already delivered can also be brought into scope.

Applications will follow a procedure set by the Secretary of State. Expect staged steps: an expression of interest, an initial agreement confirming a proposed payment, and a deposit or reservation fee to hold an approved measure in whole or in part. The process can run in defined windows and may be shortened where consent has already been granted. Applications can be transferred to another party if needed.

Approval hinges on certainty about discharging the legal condition. Before approving an application, the Secretary of State must be satisfied that the authority imposing the compensation condition has determined the extent to which an MRF payment will discharge it. On approval, an approved measure is allocated, the payment amount and terms are set, and an MRF contract is offered that records the relevant offshore wind activities, the effects being compensated, the expected outcomes and the monitoring period.

Fees introduce a new cost line. The Secretary of State may set fees to recover administration costs, including non‑refundable fees, and may peg them to the estimated value of the allocated measure. Fee schedules and any changes must be published. For finance teams, that means budgeting for application charges and potential reservation deposits alongside the core compensation payment.

Risk transfer is formalised once money moves. When a participant pays the full MRF payment-or the first instalment-the Secretary of State becomes responsible for delivering the allocated measure, on the contract terms. For developers and lenders this offers a clearer path: the discharge extent is pre‑determined, and delivery risk sits with the fund operator from first payment, while sponsors carry the defined payment obligation.

Payments out of the funds can cover development of measures for approval, delivery of measures, acquisition of measures already delivered, and long‑term monitoring, adaptation or decommissioning. That creates a pipeline for restoration and monitoring providers to pre‑develop projects and sell them into the MRF, potentially smoothing delivery timelines for large build‑outs.

Outcomes will be actively managed. During the monitoring period in the contract, government will test the efficacy of the allocated measure and can adapt it, replace it, or add another approved measure if this would achieve the expected outcomes more appropriately. Decommissioning is also provided for. From a financing angle, this adaptive clause supports performance over time without reopening the developer’s compensation commitment.

Territorial flexibility and continuity are built in. Government can extend a fund to additional territories and can close all or part of a fund to new applicants. Where a fund is territory‑specific, any closure or cancellation of a delegation to a devolved authority requires consultation with the relevant ministers, with a minimum consultation period of 12 weeks. Existing MRF contracts continue unaffected by a closure decision.

Commercially, the model shifts compensation from bespoke, project‑delivered measures to a standardised pay‑into‑a‑fund approach. In practice, sponsors may factor fees, deposits and the MRF payment into capex and bid pricing, while consenting risk reduces once the discharge determination is in hand. Lenders will look closely at contract terms-particularly the monitoring period-given it shapes long‑run obligations.

What to watch next: publication of the application procedure, fee schedule and the first list of approved measures by the Secretary of State. DEFRA notes a full impact assessment is available with the Explanatory Memorandum on legislation.gov.uk. For supply chains, this opens opportunities in habitat restoration, verification and monitoring-backed by contracts and a defined payor.