Energy UK, the domestic energy industry trade body, has urged the government to reinstate Contracts for Difference (CfDs) auctions for established low carbon technologies like solar PV. The call comes within Energy UK’s five year review of the Electricity Market Reform policy package, which in 2013 sought to trigger an evolution of the UK’s energy markets. The full review is due to start next year but Energy UK, having consulted with its members, has put forward its opinion on some of the key policies. And central to that is a call for CfDs to not only continue, but for established low carbon technologies to be reinstated. So-called ‘Pot One’ technologies, which includes just solar and onshore wind, have effectively been restricted from the CfD process since the first auction took place in 2015. Auctions have since then been limited to Pot Two – less established technologies such as offshore wind – which has resulted in significant cost reductions. But Energy UK has now called for this exclusion to end and for Pot One technologies to be allowed to compete for ‘revenue stabilisation’ CfDs. It says these contracts would remove some of the inherent merchant risk of wholesale price fluctuations most commonly caused by volatility in the fossil fuel markets.
Solar Portal 24th May 2018 read more »