The budget notice for the first allocation round for Contracts for Difference (CfDs) has been published today.
Apparently responding to almost universal dismay when the draft budget notice was published in the Summer, DECC have confirmed an increase in all delivery years apart from the first, and importantly have now given visibility as far as 20/21.
The budget for delivery year 15/16 remains at £50m (2011/12 prices) for established technologies, increasing to £65m for each of the following delivery years.
For the less-established technologies (including offshore wind), the pot remains at £155m in the first year (16/17 for the less-established technologies) and then rises to £235m for each of the following delivery years.
A minimum of 10MW for wave and tidal applies in this allocation round, out of a reserved budget of 100MW for the whole of the Delivery Plan period.
Clients hoping to bid for a CfD in this allocation round must bear in mind that the budgets are set in 2011/12 prices, whereas the administrative strike prices are set in 2012 values. Before National Grid values the bids, Government will inflate the budgets to a 2012 price base using a CPI inflator of 1.0195
Disclaimer
The material contained in this article is of the nature of general comment only and does not give advice on any particular matter. Recipients should not act on the basis of the information in this e-update without taking appropriate professional advice upon their own particular circumstances.
