Contracts for Difference (CfD): new Supply Chain Plan questionnaire

Overview

We are seeking views on proposals for a new Supply Chain Plan questionnaire for CfD Applicants to complete. It will form the basis of the initial assessment before an allocation round and ongoing monitoring, review and assessment after CfD signature.  These plans were set out in the November 2020 consultation on proposals to strengthen our Supply Chain Plan policy and on changes to the CfD contract.  Interested parties may wish to consider both consultations together.  This consultation will run in parallel to the November consultation on the Supply Chain plan process for 2 weeks until the first consultation closes on 28^th January 2021. You will then have a further 6 weeks to respond to this consultation.

The proposed new Supply Chain Plan questionnaire will be aligned to the Industrial Strategy and strengthened by including more specific questions aimed at eliciting focussed and measurable responses that are closely aligned to government objectives.  Applicants will be invited to submit their proposed actions to achieve the objectives of the Supply Chain Plan policy.

Responses by the Applicant to the scored sections of the Supply Chain Plan questionnaire will be assessed to determine eligibility to participate in the CfD scheme. Delivery of the activities and outcomes committed to in the scored sections of the Supply Chain Plan will then subsequently be monitored as part of an ongoing process after CfD signature. Finally, they will be assessed in the Supply Chain Implementation Report by the Secretary of State before the generating station is due to be commissioned.

We welcome responses from anyone with an interest in Supply Chain issues. We expect this consultation document will be of particular interest to those considering developing new low carbon energy projects in Great Britain (GB), businesses involved in low carbon electricity generation supply chains and consumer and environmental groups with an interest in the electricity sector.

Why your views matter

The government is committed to decarbonising our economy and meeting our net zero obligations. Renewable electricity generation plays a pivotal role in achieving this, which is why it has a central position within the Prime Minister’s 10 Point Plan for a Green Industrial Revolution.

To help support this we will seek to deliver up to double the amount of renewables capacity in the fourth Contract for Difference (CfD) Allocation Round, opening in late 2021, compared to the last auction. As we scale up our ambitions and remain world leaders in green technology, it is vital that our economy realises the economic benefits of this large-scale infrastructure programme.  

In November 2020, the government consulted on a range of proposals to strengthen our Supply Chain Plan policy and on changes to the CfD contract to implement some of the policy decisions set out in the government response to the March 2020 consultation. Subject to the outcome of this consultation, CfD regulations could be amended to give effect to these new requirements. The November consultation sets out the details of the proposed new Supply Chain Plan process, including information on what developers will need to submit and when, the ongoing monitoring process and the assessment approach.  A new draft Supply Chain Plan guidance document explaining the proposed process was produced as part of that consultation.  

This consultation sets out our proposals for a new Supply Chain Plan questionnaire for CfD Applicants to complete, which will form the basis for initial assessment before an allocation round and ongoing monitoring, review and assessment after CfD signature. This consultation will run in parallel to the consultation on the Supply Chain plan process for 2 weeks (so you may wish to consider them together) until the first consultation closes on 28 January 2021. You will then have a further 6 weeks to respond to this consultation.

Respondents are encouraged to review the November consultation to inform their responses to this consultation on the new Supply Chain Plan questionnaire. The proposals included in this consultation are intended to align with those put forward in the November consultation and do not prejudge the outcome of that consultation. 

What happens next

Following the close of this consultation, we will analyse the responses, summarise the views expressed and set out final decisions in a government response. We intend to publish this in summer 2021, before the opening of the fourth CfD Allocation Round in late 2021, on the GOV.UK website.