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BEIS opens consultation on CfD Supply Chain Questionnaire

By: Tom Russell 14/01/2021 4C Offshore

General Windfarms

The Department for Business, Energy and Industrial Strategy has launched a consultation on its New Supply Chain Plan Questionnaire for its Contracts for Difference (CfD) scheme.

BEIS is proposing to introduce a new Supply Chain Plan questionnaire to be which is to be completed as part of the Supply Chain Plan application process. It will form the basis of the initial assessment before an allocation round and ongoing monitoring, review and assessment after CfD signature.

The proposed new Supply Chain Plan questionnaire will be aligned to the Industrial Strategy and will include more specific questions aimed at eliciting focussed and measurable responses that are closely aligned to government objectives. Applicants will be invited to submit their proposed actions to achieve the objectives of the Supply Chain Plan policy.

Responses by the Applicant to the scored sections of the Supply Chain Plan questionnaire will be assessed to determine eligibility to participate in the CfD scheme. Delivery of the activities and outcomes committed to in the scored sections of the Supply Chain Plan will then subsequently be monitored as part of an ongoing process after CfD signature. Finally, they will be assessed in the Supply Chain Implementation Report by the Secretary of State before the generating station is due to be commissioned.

Following the close of this consultation, BEIS will analyse the responses, summarise the views expressed and set out final decisions in a government response. It intends to publish this in summer 2021, before the opening of the fourth CfD Allocation Round in late 2021 which aims to increase the capacity of renewable energy from the 5.8 GW achieved in the last round to up to 12 GW. Responses are to be submitted before 11 March 2021.

The consultation is part of BEIS wider proposals to changes to the CfD scheme. In November it launched a consultation proposing further amendments to the scheme in relation to Supply Chain Plans, policy proposals on phasing for floating offshore wind and changes to the CfD contract. The consultation closes at 11:45pm on 18 January 2021.

About the CfD scheme

The CfD scheme is the government’s primary method of supporting low-carbon electricity. It encourages investment in renewable energy by providing projects with a stable income, while protecting consumers from paying increased costs when electricity prices are high.

The fourth round will see three ‘pots’ for renewable technologies. Pot 1 includes established technologies – such as onshore wind and solar PV. Pot 2 includes less-established technologies – including floating offshore wind, Advanced Conversion Technologies and tidal stream.

Government support for offshore wind generation has seen the cost of it fall by two thirds in the last 5 years. Given its long-term potential to support the country’s 2050 net zero target, offshore wind projects will compete in their own pot - titled 'Pot 3 - rather than against other technologies as they have previously.

For more information on offshore wind farms worldwide, click here.

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BEIS opens consultation on CfD Supply Chain Questionnaire

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