Energy Bill Receives Royal Assent
The Energy Bill received royal assent on 18 December 2013, enshrining in statute a raft of new powers which form part of the Government's Electricity Market Reform ('EMR') policy. There will of course be secondary legislation which will provide more detail.
Significantly, the passing of the Energy Bill into law confirms the end of the Renewables Obligation. From April 2017, eligible generators will no longer be able to claim Renewables Obligation Certificates ('ROCs'). They will, instead, enter into a Contract for Difference ('CfD'), under which they will receive a variable 'top-up' equal to the difference between a standardised electricity market reference price and a contractually-set 'strike price'.
There will now be an interim period when both ROCs and CfDs will be available. Smaller projects will continue to be supported by the existing system of Feed in Tariffs.
DECC have also published (on 19 December 2013) the EMR Delivery Plan. The Delivery Plan sets out the following:
- the Government's final decision on strike prices for CfDs for the period 2014/2015 to 2018/2019;
- the Levy Control Framework;
- the reliability standard for the Capacity Market; and
- next steps in the EMR.
In addition to the Delivery Plan, the Government has also released revised text of the draft CfD Agreement and CfD Terms and Conditions.
We are monitoring the implementation of the Act for a number of our clients who are active in this sector.
For further information, please contact Ian Holyoak, Head of Energy & Renewables at Michelmores, by telephone on 01392 688 688 or by email email@example.com, or your usual Michelmores contact.