UK confirms CfD competition plan

The UK government has confirmed its intention to force “established” renewables technologies to compete for Contracts for Difference (CfD) from later this year based on cost alone, with major implications for onshore wind and solar PV.

The government originally signaled its intention to initiate the CfD scheme – the lynchpin of the sweeping Electricity Market Reform package – with a first-come-first-served allocation system for renewables projects.

Yet a number of factors – including the European Commission’s growing impatience with technology-specific support schemes – have led Whitehall to ditch the idea of a first-come-first-served system altogether for technologies deemed established.

That grouping – including onshore wind and large-scale PV, in addition to others like landfill gas and energy-from-waste-with-combined-heating-and-power – would instead be forced from this autumn into a “constrained allocation” system, in which bids are assessed on price alone.

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