Low Carbon Contracts Company & Electricity Settlements Company
The Low Carbon Contracts Company and the Electricity Settlements Company are both private limited companies owned by the Secretary of State for Business, Energy and Industrial Strategy (BEIS) and established to play key roles in the delivery of Electricity Market Reform (EMR), the biggest change to the electricity market since privatisation
LCCC determines ILR and TRA for Q4 2022, updates for potential AR4 Generators and BEIS updates on nuclear RAB model
Low Carbon Contracts Company (LCCC) has determined the Interim Levy Rate (ILR) and the Total Reserve Amount (TRA) for the Quarterly Obligation Period from 1st October 2022 to 31st December 2022.
The amounts are:
- ILR = £0.000 £/MWh
- TRA = £390,333,501.70
In making this determination, LCCC notes the high volatility of power market prices. Market prices for this calculation were taken as closing mid-prices on 15th June 2022, as shared in this update: Market reference date for Q4 2022 CfD Interim Levy Rate (ILR) and Total Reserve Amount (TRA).
LCCC will be monitoring market prices closely and will make an adjustment to the ILR and/or TRA if market prices move in such a way as to lead LCCC to expect that the TRA will be insufficient to cover or significantly in excess of the CfD costs, noting that once the quarter has started, the TRA can only be increased.
For further detail on LCCC’s calculations, please refer to our online CfD Levy Dashboards.
Information to support potential AR4 Generators
Ahead of Allocation Round 4, LCCC has updated guidance documents and other information to support CfD Generators. An updated version of the Initial Conditions Precedent (ICP) guidance document and a podcast outlining the Legal Opinion part of the ICP process are available now via LCCC's Publications webpage.
An online workshop on 30 June will provide potential AR4 Generators with an overview of the ICP process and a chance to put questions directly to LCCC's Contract Management team. Additionally, a recording of LCCC's recent webinar outlining changes to the contract production process for AR4 is now available via LCCC's Webinars webpage.
BEIS updates on nuclear Regulated Asset Base (RAB) model
The Department for Business, Energy and Industrial Strategy (BEIS) recently published a suite of documents that show significant progress toward implementing a Regulated Asset Base (RAB) funding model to support new nuclear projects. The Sizewell C project in Suffolk could be the first nuclear project to use the RAB model, subject to the outcome of current negotiations.
LCCC has been designated as revenue collection counterparty for the nuclear RAB model, as announced in this Notice. A consultation seeking views on the revenue regulations for the implementation of the nuclear RAB model revenue stream is currently open, and will close at 11:45pm on 9 August 2022. The consultation is available here: BEIS consultation: Revenue stream for nuclear RAB.
Further details on this update are available in this news story: Kwarteng advances plans for funding new nuclear projects, including Sizewell C.
A Stakeholder Bulletin outlining the above items has been published today and is available to download via the button on this webpage.