Contracts for Difference (CfD)

DEFINITION: A private law contract between a low-carbon electricity generator and the Government. The generator party is paid the difference between the ‘strike price’ – a price for electricity reflecting the cost of investing in a particular low-carbon technology – and the ‘reference price’– a measure of the average market price for electricity in the UK market. CfD provides long-term price security to renewable energy providers, allowing investment to come forward at a lower cost of capital and therefore at a lower cost to consumers.

See also: Levy Control Framework (LCF)

Related items

Multiplex's social strategy and Spain's clean energy package: The sustainability success stories of the week

As part of our Mission Possible campaign, edie brings you this weekly round-up of five of the best sustainable business success stories of the week from across the globe.

Image: Orsted 

UK's clean energy investment ranking drops amid Covid-19 funding crunch

The UK has fallen one position to fifth in EY's bi-annual ranking of the attractiveness of national renewable energy investment. The drop is largely attributable to a lack of green finance - a challenge EY believes is likely to be overcome in the coming months.

If the same pace of investment is maintained, peak oil will happen “around 2030,” according to CMS Research

Study: World set to hit 'peak oil' by 2030 as energy majors shift to renewables

The world's largest oil and gas companies increased investment in clean energy by 34% in 2020, despite a 6% fall in global energy demand caused by the coronavirus pandemic, according to new research.

Global average solar installation costs are likely to be down 10% year-on-year, according to the IEA

IEA: Renewables set to attract 70% of global energy investment in 2021

Global energy investment is likely to rebound to pre-pandemic levels this year, with most finance going towards renewables - but, ultimately, the new generation capacity financed will not be compatible with long-term climate goals.

Image: HP 

HP unveils sustainability 'changemaker' and 'catalyst' schemes

Tech giant HP has launched a new scheme offering industry partners the resources and traning they need to accelerate sustainability progress, in the same week that Octopus Energy unveiled what it claims is the world's first energy technology research organisation.

Pictured: Iberdrola's Francisco Pizarro solar plant in Spain, which has a PPA with RE100 member Danone. Image: Iberdrola

Corporate demand for renewable electricity outpacing improvements in policy and infrastructure

One-third of businesses with commitments to source 100% renewable electricity are facing challenges meeting their goals due to a lack of policy support, according to CDP and the Climate Group.

This edition of our monthly cleantech roundup recaps on COP26 and edie's Net-Zero November 2021 campaign 

'Smart' food waste tags and brilliant bees: The best green innovations of November 2021

As November comes to a close, edie and our innovation partner Springwise have rounded up some of the best breakthrough technologies and carbon-cutting solutions which could accelerate climate action over the coming months and years.

Pictured: Work inside GM's FactoryZERO in Detroit, Michigan. Image: GM

General Motors set to hit 100% renewable energy milestone in the US five years earlier than planned

Automotive giant General Motors (GM) has pushed a commitment to source 100% renewable energy for its US operations forward from 2030 to 2025.

Each company is progressing towards ambitious climate targets

Mars, Diageo and Dropbox unveil major renewables milestones

Mars, Diageo and Dropbox have all unveiled plans to add more renewables to their electricity mix, with Diageo planning for an onsite solar farm in Scotland.

#SustyTalk: Budweiser Brewing Group's Mauricio Coindreau on renewable energy procurement

edie's #SustyTalk interview series continues with an exclusive discussion with Budweiser Brewing Group's head of procurement & sustainability Mauricio Coindreau.

EnergyTag states that there is currently no recognised system to verify hourly clean energy consumption

Google and Microsoft among businesses backing 24/7 clean energy tracking

More than 100 global companies, including PwC, Microsoft and Google, are taking part in a new worldwide initiative aimed at verifying clean energy sourcing on an hourly basis.

Image: Johnson & Johnson Vision

Johnson & Johnson Vision to power global HQ with 100% solar electricity

Johnson & Johnson Vision, the manufacturer of ACUVUE contact lenses, has signed a ten-year power purchase agreement (PPA) with a solar farm to cover 100% of the electricity consumption of its headquarters.

Ikea's forest protection and Dove's refillable deodorant: The sustainability success stories of the week

As part of our Mission Possible campaign, edie brings you this weekly round-up of five of the best sustainability success stories of the week from across the globe.