You are here

What is a zero-subsidy CfD?

The Conservative Party says it is keeping a manifesto commitment to halt subsidies for onshore wind. But is there a loophole – a Contract for Difference that provides support but not subsidy? Janet Wood examines a potential economic answer to a political question

Renewable energy capital costs are falling fast, but so are the subsidies available to bring them on. In its election manifesto, the Conservative Party promised no subsidies for onshore wind – but it is hard to see how affordability is served by discarding the most cost-effective technologies and forcing consumers to subsidise higher-ticket items instead. The government is looking for an economic answer to a political question. Could zero-subsidy Contracts for Difference (CfDs) be the solution?

To continue reading this article please login if you already have an account or subscribe.