Reformed CfD auctions could save £2bn: Drax
A report commissioned by Drax has said consumers could save over £2bn if contracts for difference (CfD) auctions were opened to a wider range of technologies. The study, prepared by NERA, examined the “hidden costs that are not reflected in the contracts government awards for renewables generation”. It suggested that, once these additional costs were recognised, offshore wind––on which the government has said its CfD auctions will focus––would require a strike price of £127/MWh, with onshore wind at £92/MWh-£97/MWh, solar at £96/MWh, and biomass at £84/MWh. Modelling these support levels over the planned auctions suggested consumers could save £1.9bn-£2.2bn with more technology neutrality.