Low Carbon Contracts Company
The Low Carbon Contracts Company (LCCC) was established in 2014 as an independent limited company that is wholly owned by the Secretary of State for Business, Energy and Industrial Strategy (BEIS).
It was established to be the Contracts for Difference (CfD) counterparty under the CfD regulations and the entity with whom successful energy generators sign a contract after an auction process administered by National Grid (ESO).
The Governments Contracts for difference website https://www.gov.uk/government/publications/contracts-for-difference/contract-for-difference states:
"The Contracts for Difference (CfD) scheme is the UK government’s main mechanism for supporting low-carbon electricity generation, it incentivises investment in renewable energy by providing developers of projects with high upfront costs and long lifetimes direct protection from volatile wholesale prices, and they protect consumers from paying increased support costs when electricity prices are high."
UK renewable generators in the UK that meet eligibility requirements can apply for a CfD by submitting a form of ‘sealed bid’, so far the 4 auctions, or allocation rounds, have seen a range of different renewable technologies competing directly against each other for a contract. The LCCC host engagement events to help and advise stakeholders on the details of the contract and the obligations required of the generator in the period leading up to the allocation round.
The LCCC works with generators, once contracts are signed, to take them through the various milestones that have to be met before the start date of a project,after which point CfD payments are determined and then paid by the LCCC for the duration of the contract term. It also provides advice to BEIS on the performance, development and potential evolution of the CfD scheme.
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