GGSS budget caps, production factors, and inflation forecasts for 2023-2024
Updated 22 December 2023
Applies to England, Scotland and Wales
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This page covers the GGSS budget caps and their supporting information effective for the 2023-2024 financial year (1 April 2023 to 31 March 2024).
BEIS is required to publish this information under the Green Gas Support Scheme Regulations (reg. 4(13)).
The GGSS has 2 budget caps, which are shown in Table 1: the Application Budget (AB), which limits estimated spend by acting as a cap against which all applications to the scheme are checked, and the Overall Scheme Expenditure Budget (OSEB), which sits above the AB, and is used to set the Green Gas Levy rate.
This page also contains the production factors (Table 2) and inflation forecast (Table 3) used to set the budget caps for the 2023-2024 financial year, which are used in the assessment of applicants’ estimated annual payments against available budget when they apply for a tariff guarantee.
Further information on GGSS budget caps and the production factors and inflation forecasts used to set them is published on the GGSS Budget Management Guidance page.
Budget caps
Table 1: GGSS budget caps (set 20 /12/2022, effective from 1/4/2023)
| Year | 2023/24 | 2024/25 | 2025/26 | 2026/27 | 2027/28 |
|---|---|---|---|---|---|
| AB (£M) | 32.9 | 88.2 | 132.2 | 160.7 | 172.3 |
| OSEB (£M) | 37.8 | 101.4 | 152.0 | 184.8 | 198.1 |
Production Factors
Production factors are used to estimate the proportion of a plant’s total registered capacity that we expect to be used to produce eligible biomethane in any given quarter of a plant’s time on the scheme.
Table 2: Production factors used to estimate AB commitments from 1 April 2023
| Quarter Following Registration | Production Factor |
|---|---|
| Q1 | 43% |
| Q2 | 59% |
| Q3 | 63% |
| Q4 | 67% |
| Q5 | 72% |
| Q6 | 76% |
| Q7 | 76% |
| Q8 | 78% |
| Q9 | 79% |
| Q10 | 82% |
| Q11 | 86% |
| Q12 | 87% |
| Q13 | 88% |
| Q14 | 88% |
| Q15 | 88% |
| Q16 | 91% |
| Q17 | 93% |
| Q18 | 94% |
| Q19 | 99% |
| Q20+ | 99% |
Inflation Forecast
The inflation forecast used to calculate budget caps effective from 1 April 2023 to 31 March 2024 was based on the Office of Budget Responsibility’s Consumer Price Index (CPI) forecast published in November 2022. Each financial year’s figure is set at the OBR’s forecast for Q4 for the preceding calendar year.
Ofgem is responsible for uprating GGSS tariffs annually on 1 April, starting on 1 April 2023, using the actual CPI rate from the previous December. This covers inflation for that calendar year and is published by ONS each January. The forecast used from the OBR to set budget caps is used as the closest available for the figure that Ofgem will use – the forecast rate for Q4 for each calendar year is the closest to the December rate.
Table 3: Inflation forecast used to estimate AB commitments from 1 April 2023
| Financial year | 2023/24 | 2024/25 | 2025/26 | 2026/27 | 2027/28 |
|---|---|---|---|---|---|
| Estimate of CPI inflation | 11.1% | 3.8% | -0.1% | -1.3% | 1.2% |