Levy Summary
Contracts for Difference
The CfD (Contracts for Difference) levy provides revenue stability for eligible low carbon generators through a guaranteed strike price. Suppliers will receive or make payments based on the differential between the Generator’s strike price and the market price.
Total annual cost of scheme (including operational cost levies):
Financial Year 2021 -2022 Costs
£280.6m
Financial Year 2022 -2023 Costs
£5.3m
Financial Year 2023 -2024 Costs
£1,882.9m
- CfD Daily Levy Rates
- CfD Supplier Payments
- CfD Operational Costs
- CfD Allocation Rounds
- CfD Two Year Forecast
- CfD Key Dates
- CfD In-Period Tracking
- CfD Determination
- CfD and Nuclear RAB Reserve Payment Guidance
- Supplier CfD and Nuclear RAB Credit Cover Guidance
- Supplier CfD and Nuclear RAB Payment Guidance
- Supplier CfD and RAB FAQs
Capacity Market
The CM (Capacity Market) manages the security of supply of electricity and ensures that Britain has enough reliable capacity to meet demand at least cost to consumers. It does this by providing a payment against the Capacity Market Supplier Charge’ and ‘Capacity Market Settlement Costs Levy for reliable sources of capacity through annual auctions.
Total annual cost of scheme (including operational cost levies):
Delivery Year 2021 -2022 Costs
£856.3m
Delivery Year 2022 -2023 Costs
£680.5m
Delivery Year 2023 -2024 Costs
£1,031.7m
Forthcoming Levies
Nuclear RAB
In 2022 the government introduced the option of a Regulated Asset Base (RAB) model to help fund future nuclear energy projects during construction, commissioning and operation. This will be funded by a levy on electricity suppliers.
GSO
The Gas Shipper Obligation (GSO) is intended to be the long-term funding mechanism for initial hydrogen production projects funded through the Hydrogen Production Business Model. It may also fund further hydrogen projects, subject to future decisions on the hydrogen programme and the funding of future hydrogen production projects. At its core, the GSO is a levy on Gas shippers.
CIB (Amendment to the CfD)
The government has launched the CfD Clean Industry Bonus (CIB). Fixed and floating offshore wind applicants can obtain extra CfD revenue support if they choose to invest in more sustainable supply chains
LCCC is expecting an amendment to the Supplier Obligations to fund this scheme as it is to launch for AR7.
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