Consultation launched on Wholesale CfDs

A consultation has been launched on the planned design of a new Contracts for Difference scheme for low-carbon generators.

Earlier this year the Government announced plans for the mechanism to ‘de-link’ gas and electricity prices by voluntarily moving legacy generators onto new Wholesale CfDs.

It said a move to a fixed-price arrangement would protect consumers from future crises where gas prices spike while providing generators with greater revenue certainty.

The consultation covers the case for intervention, scheme eligibility, allocation and auction design, commercial arrangements, potential electricity market impacts, and required legislative changes.

It also seeks views on a possible hybrid model for generators accredited under the Renewables Obligation.

The Government said responses are welcomed from electricity generators, suppliers, industry bodies, consumer groups, investors, regulators and any other interested stakeholders.