The British Government has reached a landmark agreement on energy policy that will deliver a clear and durable signal to investors. The United Kingdom is amending its Energy Bill and the Parliament will examine the reforms to be implemented before 2014 this week.
The Government agreed on the creation of a Government-owned company to act as a single counter-party to give investors confidence to enter into new long term Contracts for Difference for low carbon electricity projects. During the 2020s, many old coal-fired power plants will be closed, requiring massive investments in low-carbon power capacities. The amount of market support (consumer bill surcharge) to be available for low carbon electricity investment (under the Levy Control Framework) up to 2020 be set at £7.6bn (€9.4bn, real 2012 prices) in 2020, which corresponds to around £9.8bn (€12.1bn, nominal 2020 prices). Energy companies currently charge about £20 (€25) extra per year to help pay for clean energy projects. This, it says, will rise to £95 (€117) in 2020.
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