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
BEIS launches consultation on LCCC and ESC's operational cost budgets and levies for 2022/23, 2021/24 and 2024/25
The Department for Business, Energy and Industrial strategy (BEIS) is seeking views on the proposed 2022/23, 2023/24 and 2024/25 operational cost budgets and resulting levies for the Low Carbon Contracts Company (LCCC) and the Electricity Settlements Company (ESC).
LCCC enters into and manages Contracts for Difference (including the Investment Contracts which have been transferred to it) with low carbon generators, awarding top-up payments for qualifying generation. ESC is responsible for all financial transactions relating to the Capacity Market, including making capacity payments to capacity providers, managing supplier credit cover and capacity providers’ auction credit cover.
The operational costs of the companies are recovered through levies on electricity suppliers, as set out in legislation. Subject to the outcome of the consultation, the regulations will be amended, and the operational cost levies for 2022/23 to 2024/25 will be reflected in secondary legislation, which is intended to be laid in Parliament in early 2022, to come into force (subject to the will of Parliament) before 1 April 2022.
The consultation will close at 11:45pm on 03 December 2021. For further details on the consultation and how to respond, please refer to BEIS’ dedicated webpage: Low Carbon Contracts and Electricity Settlements Company Operational Costs 2022-23 to 2024-25.