UK government publishes CfD response and strengthens case for UK supply chain
View all news from:
DeepWind
View directory entry for:
DeepWind
10 May 2021
The UK Government has published its response to the consultation on the Contracts for Difference (CfD): changes to the Supply Chain Plans and the CfD Contract. The Government intends to proceed with all of their proposed changes in the consultation with some minor, but possibly critical, amendments to their proposals on the Supply Chain Plan.
This strengthens the case for the UK supply chain to be well represented in any future Supply Chain Plans included in the CfD process. Developers will now face the risk of having their CfD contract terminated should their Supply Chain Implementation Statement be refused by the Secretary of State.
The highlights in the consultation response include:
- the assessment of a developer’s delivery of its supply chain commitments to be brought forward to shortly after a project’s Milestone Delivery Date (one of the changes was this assessment date being brought forward)
- the implementation of new powers in legislation for the Secretary of State to assess and either pass or refuse a Supply Chain Implementation Statement
- the introduction of a new Operational Condition Precedent with the potential consequence of CfD contract termination if a Supply Chain Implementation Statement certificate is not provided to the Low Carbon Contracts Company before the Longstop Date
- the definition of floating wind being linked to a 45m or above water depth
The floating wind water depth definition means that almost all the ScotWind sites could potentially host floating wind projects, but fixed solutions are still likely on the shallower sites.
CfD Allocation Round 4 will see the implementation of these changes outlined above and this round is now expected to take place in December this year.
