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Clifford Chance

Clifford Chance


Contracts for Difference: an EMR CfD Primer

19 October 2015

This primer briefing is the first in a series of briefings describing the principal mechanisms introduced as part of the UK Government's Electricity Market Reforms (EMR), namely:

  • Contracts for Difference;
  • Capacity Market Mechanism;
  • Carbon Price Floor; and
  • Emissions Performance Standard.

The EMR reforms have three key aims: to bolster the security of electricity supplies, encourage the decarbonisation of the power sector and keep energy affordable.  This briefing looks at the Contract for Difference (CfD). It describes:

  • What CfDs are and how they work
  • How CfDs are allocated and the results of allocation round 1
  • The key terms of the CfD contract

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