Teresa Pearce – 2016 Parliamentary Question to the Department for Energy and Climate Change
The below Parliamentary question was asked by Teresa Pearce on 2016-04-18.
To ask the Secretary of State for Energy and Climate Change, what assessment she has made of the potential merits of raising the level of support offered through the Contract for Difference for Hinkley Point C as a result of low wholesale energy prices.
Andrea Leadsom
The Contract for Difference mechanism provides increased price certainty to generators regardless of wholesale electricity sale prices, thereby incentivising investment in low carbon generation. It does this by paying the generator the difference between the strike price and the market reference price (a composite of wholesale price indices) for electricity sold into the market for the duration of the contract. The generator will make difference payments back to the Low Carbon Contracts Company should the market reference price rise above the strike price.
The strike price for the Hinkley Point C project was agreed in October 2013 and is £92.50/MWh. If EDF take a Final Investment Decision in relation to Sizewell C, the strike price for Hinkley Point C will be reduced to £89.50/MWh.
