Contracts for Difference scheme
E843167
UK government policy instrument
electricity market support scheme
renewable energy support mechanism
The Contracts for Difference scheme is a UK government support mechanism that guarantees low-carbon electricity generators a fixed “strike price” for power, stabilizing revenues and encouraging investment in projects such as offshore wind farms.
Statements (48)
| Predicate | Object |
|---|---|
| instanceOf |
UK government policy instrument
ⓘ
electricity market support scheme ⓘ renewable energy support mechanism ⓘ |
| administeredBy |
Low Carbon Contracts Company
NERFINISHED
ⓘ
UK Department for Energy Security and Net Zero NERFINISHED ⓘ |
| alsoKnownAs |
CfD scheme
NERFINISHED
ⓘ
UK Contracts for Difference NERFINISHED ⓘ |
| appliesTo | Great Britain electricity market NERFINISHED ⓘ |
| beneficiary |
biomass projects
ⓘ
low-carbon electricity generators ⓘ nuclear power projects ⓘ offshore wind projects ⓘ onshore wind projects ⓘ solar photovoltaic projects ⓘ |
| country | United Kingdom ⓘ |
| designFeature |
competitive allocation rounds
ⓘ
index-linked strike prices ⓘ long-term contracts for generators ⓘ technology-specific pots ⓘ |
| evaluationBy | UK National Audit Office NERFINISHED ⓘ |
| excludes | most existing fossil fuel generation ⓘ |
| fundingSource | levy on electricity suppliers ⓘ |
| governedBy | CfD Standard Terms and Conditions NERFINISHED ⓘ |
| impact |
increased deployment of offshore wind in the UK
ⓘ
price stability for supported generators ⓘ reduced financing costs for low-carbon projects ⓘ |
| introducedBy | UK government NERFINISHED ⓘ |
| legalBasis | Energy Act 2013 NERFINISHED ⓘ |
| mechanism |
guarantees a fixed strike price for electricity
ⓘ
pays difference between strike price and reference wholesale price ⓘ requires generators to pay back when wholesale price exceeds strike price ⓘ |
| monitoredBy | Low Carbon Contracts Company NERFINISHED ⓘ |
| policyArea |
climate change mitigation
ⓘ
renewable energy policy ⓘ |
| policyGoal |
provide value for money for consumers
ⓘ
support UK net zero greenhouse gas emissions target ⓘ |
| purpose |
encourage investment in low-carbon projects
ⓘ
reduce carbon emissions from power generation ⓘ stabilize revenues for low-carbon generators ⓘ support low-carbon electricity generation ⓘ |
| relatedTo |
Capacity Market
ⓘ
UK Electricity Market Reform NERFINISHED ⓘ |
| sector | electricity ⓘ |
| startDate | 2014 ⓘ |
| timeHorizon |
35-year contracts for some nuclear projects
ⓘ
typically 15-year contracts for renewables ⓘ |
| usesConcept |
reference wholesale electricity price
ⓘ
strike price ⓘ |
Referenced by (1)
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