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Drax’s two biomass units are among the 16 projects fast tracked for Contracts for Difference (CfD) under the government’s Electricity Market Reform (EMR), for which the final delivery plan was published today.
The plan, which follows the granting of Royal Assent to the Energy Bill yesterday, includes details of the 16 renewables projects fast-tracked for CfDs, as well as details of the capacity mechanism. As well as Drax, projects on the list include Dong Energy’s Burbo Bank Offshore Wind Farm and Ecotricity’s Heckington Fen. Eggborough coal plant was not on the list.
Energy secretary Ed Davey said: “We have driven the Energy Bill through Parliament on time to send out a clear signal to investors and industry. We have delivered the certainty they need and confirmed Britain’s position as one of the most attractive countries in the world to invest in energy generation.
“We are now able to build on the measures already in place to deliver cleaner energy, affordable bills, energy security and the creation of thousands of skilled green jobs across the UK.”
The plan confirms details of the capacity market, including confirmation of the three hours loss of load expectation (LOLE), which means that demand should not outstrip supply more than three hours a year.
DECC made a raft of announcements alongside the delivery plan, including:
- Confirmation of the strike prices for renewable technologies under Contracts for Difference (CfD) as well as the analysis underpinning these decisions.
- A revised version of the CfD, with improvements made to the contract terms to further support the ability of developers to bring forward investment at lower cost to consumers.
- DECC confirmed it is considering introducing competition for more established low carbon technologies when the CfD regime is introduced. This will be decided in early 2014.
Ofgem has also today approved National Grid’s request to develop new services to ensure sufficient capacity in the period before the Capacity Market is operational. This will see existing and mothballed facilities being available to generate power to meet additional demand as necessary.
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