Information about Contracts for Difference (CFD) Allocation Round 2

You may be aware that the Department of Energy & Climate Change (DECC) has today made an announcement regarding the second CFD Allocation Round.

The current intention is to hold this Allocation Round by the end of 2016, if Government’s strict conditions on cost reduction are met. We’ll be working with the different delivery partners to agree next steps and implementation plan, as further details are released. LCCC will also, in collaboration with delivery partners, hold events for Stakeholders to share further information on topics such as eligibility, the auction, the ‘Minor and Necessary’ process and contract award. Registration for these events will be through our website, so please register for the relevant stakeholder group to receive updates.

There are a number of parties involved in the CFD allocation process. The roles of each body involved are outlined below to assist you in directing any further queries:

-         LCCC is the designated counterparty to Contracts for Difference (CFDs). Its role is to manage CFDs, as well as to manage the Supplier Obligation Levy that funds CFD payments.

-         DECC sets the policy framework and leads on policy design and legislative implementation.

-         National Grid is the designated EMR Delivery Body. It runs the application, qualification and allocation processes for CFDs and the Capacity Market.

-         Electricity Market Reform Settlement Service (EMRS) provides settlement activities in relation to the CFDs and the Capacity Market.

LCCC also issues a monthly Bulletin to its Stakeholders. This will include updates on the Allocation Round and relevant information including dates of future events. If you would like to receive the Bulletin please contact Further updates will be provided on our website, so please refer back for updates as the process progresses. For more information please see here.