The UK government is seeking views on a major reform to the flagship renewables contracts for difference (CfD) scheme that could help drive further investment in renewable energy deployment and improve energy security.
The CfD scheme is the government’s mechanism for supporting new British low-carbon electricity generation projects, such as offshore wind and solar developers, and along with FIDER, an early form of the scheme, has awarded contracts to new low carbon projects in Britain with a total capacity of 26.1 GW.
Introduced in UK in October 2014, the CfD is based on a difference between the market price and an agreed “strike price.” CfDs are awarded for period of 15 years and are concluded between the renewable generator and Low Carbon Contracts Company (LCCC), a government-owned company.