Question

To ask the Secretary of State for Energy and Climate Change, with reference to the Answer of 14 May 2014, Official Report, column 593W, on electricity, what recent discussions he has had with the Independent Renewables Generators Group on the timing of the introduction of auctioning; what assessment he has made of independent generators' ability to raise project finance against the Offtaker of Last Resort before October 2014; and if he will make a statement.

I met with the Independent Renewable Generators Group on 24th February 2014 and discussed the introduction of auctioning for Contracts for Difference (CfDs).

The Offtaker of Last Resort will support independent renewable generators by providing for the worst-case route-to-market, allowing generators to raise project finance without necessarily having to enter long-term PPAs. As a result, such generators are likely only to need short-term PPAs in order to maximise their secured revenue and level of gearing. We are on track to deliver the final policy and introduce enabling regulations ahead of first allocation of CfDs. CfD applicants will, therefore, have a high degree of clarity about the arrangements for OLR in advance of the first auctions.