Transition from the Renewables Obligation to Contracts for Difference
Download the full outcome
Detail of outcome
This document summarises the responses received and sets out the Government’s policy decisions on the matters contained in the following two consultations:
On 17 July 2013, our consultation on the transition from the Renewables Obligation (RO) to Contracts for Difference (CfD) set out proposals on the operation of the RO during the transition period, and on arrangements at and after the point of RO closure to new capacity on 31 March 2017.
On 7 November 2013, following initial consideration of responses to the RO Transition consultation, the Government published a further consultation proposing the detailed arrangements for grace periods.
We received a wide variety of responses from electricity companies, independent generators, developers, manufacturers, financiers, trade associations and consultants and we would like to thank all those who took the time to respond to each consultation. We have issued a Combined Government Response to the two consultations so that stakeholders can see all transition policy decisions in one coherent document.
The Government believes that this comprehensive transition policy will ensure a smooth shift from the RO to the CfD for renewable generators, suppliers and consumers alike. We are giving the renewables industry the assurance and comfort needed to ensure ongoing investment, and ensuring value for money for consumers.
Original consultation
Consultation description
A key aspect of Electricity Market Reform is the transition from the Renewables Obligation, the current main support mechanism for large scale renewable electricity generation, to Contracts for Difference (CfD), the new support mechanism for low-carbon electricity generation, including renewables, nuclear, and Carbon Capture and Storage. CfDs will be open to applicants from mid-2014.
DECC seeks views on the policy and processes for the transition period, from mid-2014 to 31 March 2017, during which the RO and CfD will both be open for applications from new renewable generating capacity. New generating capacity will have a choice of application between the two schemes and will also have the option of applying for an investment contract under Final Investment Decision (FID) Enabling. All applications will be subject to the rules for the scheme in question, and to confirmation that the capacity is not receiving support under one of the other schemes.
We are also seeking views on the arrangements surrounding the closure of the RO to new generating capacity on 31 March 2017, and the options for additional capacity after that date.
Additionally, we are seeking views on the timing of the introduction of the fixed price certificate scheme, which will see the price of a certificate fixed at the 2027 buyout price, plus 10%, to see whether the position remains as set out in the July 2011 White Paper.
Responses to the Consultation
DECC is seeking input from as wide a range of interested parties as possible and the consultation includes a series of broad questions to help shape contributions from interested parties. The government response, which we expect to publish towards the end of the year, will draw principally on evidence submitted during the 10 week period.
Documents
Last updated 12 March 2014 + show all updates
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Government response to the consultation published.
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Draft Renewables Obligation Order 2014 added to the consultation page.
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First published.