Government proposes cap on renewable revenues

Source: The Engineer

Monday, 17 October 2022

Certain renewable energy generators face a cap on revenue with the government’s proposed Cost-Plus Revenue Limit in the new Energy Prices Bill.

Set to be introduced in 2023, the Cost-Plus Revenue Limit will apply to renewable generators outside of the fixed-price Contracts for Difference (CfD) scheme and will consider whether it will apply to nuclear and biomass generation.

The government has not set the limit but is considering ‘pre-crisis expectations for wholesale prices’, nor has it specified how long the temporary measure would be in place for in England and Wales.

According to the Department for Business, Energy and Industrial Strategy (BEIS), the limit is intended to ‘sever the link between high global gas prices and the cost of low-carbon electricity’, which has risen in line with the cost of gas due to the war in Ukraine.

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