Guidance

Contracts for Difference (CfD) Allocation Round 4: Allocation Framework

The Allocation Framework sets out the rules for Contracts for Difference Allocation Round 4 and the eligibility requirements applicants must satisfy.

From:
Department for Energy Security and Net Zero and Department for Business, Energy & Industrial Strategy
Published
13 September 2021
Last updated
25 November 2021 — See all updates

Documents

Contracts for Difference (CfD) Allocation Round 4: Allocation Framework (November 2021)

PDF, 584 KB, 89 pages

DRAFT: Contracts for Difference (CfD) Allocation Round 4: Allocation Framework (September 2021)

PDF, 515 KB, 87 pages

Western Isles schematic diagram template

PDF, 103 KB, 1 page

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Shetland Isles schematic diagram template

PDF, 113 KB, 1 page

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Orkney schematic diagram template

PDF, 106 KB, 1 page

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Details

The Allocation Framework for CfD Allocation Round 4 (AR4) sets out:

  • the rules for Allocation Round 4
  • the eligibility requirements that applicants must satisfy

Remote Island Wind (RIW): schematic diagrams

You can use these diagrams as part of your application if you are applying:

  • for Remote Island Wind (RIW) CfD units connecting to the national transmission system
  • to a distribution system in the local government areas of Comhairle nan Eilean Siar, Orkney Islands Council and Shetland Islands Council

Applicants can annotate the relevant diagram and submit to the Delivery Body to demonstrate that the project meets the condition in Regulation 27A(3)(d) of the Contracts for Difference (Allocation) Regulations 2014 (as amended), as set out in Schedule 5 of the Allocation Framework.

The eligibility requirements for RIW are geographically neutral and applications from any geographical location within scope will be considered.

For the purposes of Allocation Round 4, any references to soft constraints will not be relevant and will not apply for this round.

Differences from third Allocation Round

The most significant differences from the third Allocation Round are:

  • simplified operation of delivery years in auctions in Rules 9, 16, 17, 18, 19 and 23
  • amended valuation formula and operation of target dates in Rules 11, 12, 20 and Schedule 2
  • amended rules for maxima in Rules 17, 18, and 19
  • a new technology type, Floating Offshore Wind
  • extension of the delay period before the allocation process must be re-run in Rule 21
  • flexibility to apply ‘soft’ capacity caps, maxima and minima in Rules 9, 14, 16, 17, 18 and 19 (not being used in AR4)
  • amendment of rules when a bid causes an auction constraint to be equalled – though this will make no difference to the operation of auctions in AR4 as this is designed to address issues that might arise when soft constraints are applied
Published 13 September 2021
Last updated 25 November 2021 + show all updates

  1. Final version of Allocation Framework for CfD AR 4 added.

  2. First published.

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