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EDF Energy - Finance

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Contracts for difference<br />

Illustrative impact of contracts for difference on revenues for low<br />

carbon generators - £/MWh<br />

Introduction<br />

Generator pays<br />

difference<br />

• Description<br />

• Long term financial<br />

(not physical) contract<br />

Difference paid<br />

to generator<br />

• Referenced to wholesale power<br />

price (index to be defined)<br />

• Operational detail (and<br />

transition) to be defined<br />

• Implications<br />

• Price certainty for generator<br />

but operational and<br />

construction risks remain<br />

2010 2015 2020 2025 2030<br />

• Higher strike prices for more<br />

expensive renewables and CCS<br />

Illustrative contract strike price<br />

Power price + carbon price support<br />

Power price

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