Contracts for Difference (CfD): changes to Supply Chain Plans and the CfD contract
Applies to England, Scotland and Wales
Download the full outcome
Detail of outcome
The government response confirms decisions made on amendments to strengthen the Supply Chain Plan process for projects of 300MW or above entering a CfD allocation round. These include:
- the assessment of a developer’s delivery of its supply chain commitments to be brought forward to shortly after a project’s Milestone Delivery Date
- the implementation of new powers in legislation for the Secretary of State to assess and either pass or refuse a Supply Chain Implementation Statement
- the introduction of a new Operational Condition Precedent with the potential consequence of CfD contract termination if a Supply Chain Implementation Statement certificate is not provided to the Low Carbon Contracts Company before the Longstop Date
The government response also confirms the government’s decision to not extend phasing to floating offshore wind, as well as a series of technical amendments to the CfD contract.
The government also published a consultation on the Supply Chain Plan Questionnaire, which ran from 14 January to 11 March 2021. We are currently analysing responses to this consultation and will publish a government response in due course.
Detail of feedback received
The consultation attracted 53 individual written responses. Of these, 22 were from developers of renewable generating stations and 8 were from trade associations. The consultation also saw a small number of responses from:
- trade unions
- devolved and local governments
- non-governmental organisations (NGOs)
- consultancies
- technology manufacturers
- investors
- development agencies
- energy councils
- individuals
Original consultation
Consultation description
You may want to respond to this consultation in conjunction with the consultation on Supply Chain Plan Questionnaires, published 14 January 2021.
For that reason we have extended the closing date for this consultation to 28 January.
In March 2020, the government consulted on a range of proposed amendments to the Contracts for Difference (CfD) scheme ahead of the fourth Allocation Round (AR4), planned for late 2021. This consultation proposes further amendments to the scheme in relation to Supply Chain Plans and changes to the CfD contract.
The government previously sought views on whether the Supply Chain Plan policy could better encourage the growth of sustainable, efficient supply chains. The government is now proposing more detailed changes to the Supply Chain Plan policy, which are designed to increase the clarity, ambition, and measurability of developers’ commitments, and ensure that those commitments are delivered.
The government also invites views on several proposed drafting changes to the CfD contract to implement decisions taken on the following policies:
- floating offshore wind
- negative pricing
- coal-to-biomass conversions
- milestone delivery date
- minor and technical changes to improve the operation and clarity of the contract
In addition, we’re inviting views on the government’s proposal not to extend phasing to floating offshore wind projects.
Drafts of the CfD Agreement and Standard Terms and Conditions are published alongside this consultation document showing the proposed changes underlined and highlighted in colour.
We welcome responses from anyone with an interest in these issues. We expect this consultation document will be of particular interest to:
- those considering developing new low carbon energy projects in Great Britain (GB)
- businesses involved in low carbon electricity generation supply chains
- electricity traders and suppliers
- businesses operating in the bioenergy sector
- consumer and environmental groups with an interest in the electricity sector
See the BEIS consultation privacy notice.
Please do not send responses by post to the department at the moment as we may not be able to access them.
Documents
Last updated 7 May 2021 + show all updates
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Government response published.
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Closing date extended to 28 January 2021.
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First published.