One of the key functions of LCCC is to forecast and set the CFD Supplier Obligation, comprising of the Interim Levy Rate (ILR) and Total Reserve Amount (TRA), in advance of the quarter in which it is going to apply.
The Transparency Tool microsite was created to help our stakeholders understand how we arrive at our forecasts of the CFD Supplier Obligation.
The site displays supporting information on how we set the Interim Levy Rate (ILR) and Total Reserve Amount (TRA), aimed at building confidence in LCCC’s ability to accurately fulfil our regulatory obligations.
In addition to offering transparency around our calculations, the tool also provides forecasts of the ILR and TRA for a further three quarterly obligation periods following the period for which the ILR and TRA has been determined. These will consist of a base forecast based on generator start dates as published in the public CFD register, or where appropriate on the BEIS website. It may also include sensitivities around the base forecast in which one or more generators’ start dates are amended (for example, starting later due to delays in state aid approval or development and construction). Use of these forecasts is subject to legal disclaimers and this can be accessed on the site.
The payments collected from suppliers are subsequently reconciled, with actual CFD generation and demand data used to calculate the actual levy rate. To ensure that our stakeholders have up to date information on the actual costs, we intend to provide these daily reconciled levy rates on a quarterly basis to the Suppliers Area
The Transparency Tool has been designed to give suppliers confidence in the correctness of our ILR and TRA calculations. To give suppliers a view of potential costs further into the future, we now publish ILR and TRA forecasts out to 15 months. The source code for the Transparency Tool can be found here.
We often hold Stakeholder events to support industry readiness. Please click here to see information on past events and what's coming up.