Clarity on REMA urged as AR7 nears

EnergyUK has published an explainer on the AR7 CfD auction, reiterating its call for decisions on zonal pricing and the TNUoS cap and floor as soon as possible.

It said if zonal pricing is implemented, it must be accompanied by “adequate legacy arrangements” to mitigate additional risk faced by developers.

“These developers have invested billions of pounds in the UK market. Capital has a choice of location, and businesses will not hesitate to locate elsewhere if market conditions are more favourable,” it warned.

AR7 is due to open in August and more capacity will need to be procured in the auction than in any previous allocation round.

EnergyUK said extending the length of CfD contracts, ensuring auction parameters are set appropriately, and increasing CfD delivery years are all measures which will help ensure AR7 can deliver.