Consultation outcome

Electricity market reform: 'Contracts for Difference' costs - exemption eligibility

• From: Department for Business, Innovation & Skills
• Published: 4 July 2013
• Last updated: 23 August 2013 — See all updates

This was published under the 2010 to 2015 Conservative and Liberal Democrat coalition government

This consultation has concluded

Detail of outcome

This consultation closed without conclusion due to changes to the EU state aid guidelines. We reconsulted in July 2014 on ‘Electricity intensive industries: relief from the indirect costs of renewables’.

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Original consultation

Summary

We’re asking for views on the scope of exempting energy intensive industries from the costs of Contracts for Difference.

This consultation ran from
4 July 2013 to 11:45pm on 30 August 2013

Consultation description

See ‘updated cost estimates’ published August 2013.

As part of the introduction of the Energy Bill, government is seeking to exempt energy intensive industries (EIIs) from the costs of Contracts for Difference (CfDs). CfDs are part of Electricity Market Reform (EMR). CfDs aim to support investment in low carbon electricity generation.

The Department for Business, Innovation and Skills (BIS) and the Department for Energy and Climate Change (DECC) are working together to define the scope of the exemption. This will include who will be eligible and the mechanism to provide it. This consultation looks at eligibility for the exemption.

We propose, subject to state aid approval, we propose to exempt EIIs from the costs of Contracts for Difference (CfD) where they pose significant risk to UK competitiveness. We are seeking to compensate EIIs that are most at risk, to compensate them for indirect costs of energy and climate change policies, whilst minimising extra costs to other consumers.

We aim to bring the exemption into force, at the same time as the Electricity Market Reform (EMR) is implemented.

Documents

Electricity Market Reform: consultation - eligibility for an exemption from the costs of 'Contracts for Difference'

Ref: BIS/13/974

PDF, 419 KB, 37 pages

Electricity Market Reform: eligibility for an exemption from the costs of 'Contracts for Difference' - updated cost estimates

Ref: BIS/13/1137

PDF, 102 KB, 6 pages

Published 4 July 2013
Last updated 23 August 2013 + show all updates

1. 23 August 2013

   Updated cost estimates published.

2. 4 July 2013

   First published.