Press release: 2013/026
Developers of renewable electricity projects will be able to apply for support to enable them to commission and build projects more quickly.
The Government’s Final Investment Decision Enabling programme is designed to help developers of low carbon electricity projects make final investment decisions ahead of changes to the electricity market in the second half of 2014.
Further details of the process for providing support to renewable electricity projects have now been published, including information on the form of support available and the qualification criteria.
The Government aims to offer investment contracts to successful applicants in the Autumn, based on the draft strike prices and contract terms that will be published in the Summer.
By helping developers make final investment decisions this year, this process should allow construction to start on a number of projects sooner than otherwise would have been the case.
Edward Davey, Energy and Climate Change Secretary, said:
“It’s vital that we get the economy moving again, and stimulating low carbon investment and the creation of green jobs is central to this.
“We want to give investors and project developers across low-carbon technologies as much certainty as we can, as early as we can.
“That’s why we are launching a process that will enable investment decisions to be taken before changes to the electricity market come into effect, ensuring that renewable electricity projects can get built, bring investment and jobs.”
Notes for editors:
The Final Investment Decision Enabling for Renewables Update was published on Thursday 14 March 2013.
- The overall approach to Final Investment Decision Enabling for Renewables was set out in the Electricity Market Reform Technical Update in December 2011. In the EMR Operational Framework published in November 2012 , the Government provided further information on the establishment of the Final Investment Decision Enabling project.
- The Update sets out a two phase process:
- Phase 1: Application to participate and issue of Status Letters
- Phase 2: Investment Contract allocation
It includes qualification criteria which will be applied in Phase 1. Successful applications will receive a Status Letter, which will provide formal notice of the applicant’s involvement in Final Investment Decision Enabling for Renewables. In Phase 2, applicants can apply for an Investment Contract. Applications for Phase 2 will need to be received by 1 July 2013. The Government will seek to offer Investment Contracts as soon as possible after draft strike prices are published in the EMR Delivery Plan in the summer.
4. Under a Contract for Difference, returns for generators are stabilised at a fixed price level known as the ‘strike price’. Generators will receive revenue from selling their electricity into the market as usual. However, when the market reference price is below the strike price they will also receive a top-up payment from suppliers for the additional amount. Conversely if the reference price is above the strike price, the generator must pay back the difference.