{"id":256155,"date":"2023-05-05T22:15:04","date_gmt":"2023-05-05T20:15:04","guid":{"rendered":"https:\/\/climatescience.press\/?p=256155"},"modified":"2023-05-05T22:15:33","modified_gmt":"2023-05-05T20:15:33","slug":"cfd-indexation-is-a-rip-off","status":"publish","type":"post","link":"https:\/\/climatescience.press\/?p=256155","title":{"rendered":"CfD Indexation Is A Rip Off"},"content":{"rendered":"\n
\"\"<\/figure>\n\n\n\n

<\/p>\n\n\n\n

FromNOT A LOT OF PEOPLE KNOW THAT<\/a><\/p>\n\n\n\n

By Paul Homewood<\/p>\n\n\n\n

\"\"<\/figure>\n\n\n\n

We have been looking at indexation of CfD strike prices. So let\u2019s look at an example of how it works in practice.<\/p>\n\n\n\n

Beatrice is an offshore wind farm off the Scottish coast. It has been operational since 2019.<\/p>\n\n\n\n

Their first three years of full accounts show:<\/p>\n\n\n\n

\"\"<\/figure>\n\n\n\n

https:\/\/find-and-update.company-information.service.gov.uk\/company\/SC350248\/filing-history<\/a>

Profits increased by \u00a353 million between 2021 and 2022, despite lower output, on the back of higher revenue, mainly due to indexation of 8.1% on strike prices.Finance costs fell as debt began to be repaid. Most of the debt is spread over 15 years, on floating interest rates. As with most businesses with large capital expenditures, Beatrice has covered all of its long term debt with interest rate swaps, meaning the interest rate it pays is fixed for the full maturity of the loans.<\/p><\/p>\n\n\n\n

\"\"<\/figure>\n\n\n\n

The only real risk to the business profitability therefore is the actual output of the wind farm.<\/p>\n\n\n\n

In the y\/e March 2023, Beatrice received another uplift in strike prices of 8.1%, and a further 6.1% was added last month. Together these will increase revenue by another \u00a355 million, assuming output remains the same.<\/p>\n\n\n\n

It was grossly negligent and a misuse of public money for Ed Davey to have drawn up contracts guaranteeing full indexation of strike prices. I know of no private business which would have offered such generous terms.<\/p>\n\n\n\n

It is plainly evident that his only concern was to get as many wind farms built as he could, regardless of the cost to the public.<\/p>\n\n\n\n

It has been suggested that offshore wind farms simply would not have been viable without such generous terms. If so, it gives the lie to the claim that wind power is as cheap as advertised.<\/p>\n","protected":false},"excerpt":{"rendered":"

We have been looking at indexation of CfD strike prices. So let\u2019s look at an example of how it works in practice.<\/p>\n","protected":false},"author":121246920,"featured_media":256162,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_coblocks_attr":"","_coblocks_dimensions":"","_coblocks_responsive_height":"","_coblocks_accordion_ie_support":"","_crdt_document":"","advanced_seo_description":"","jetpack_seo_html_title":"","jetpack_seo_noindex":false,"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":"","jetpack_publicize_message":"","jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":true,"jetpack_social_options":{"image_generator_settings":{"template":"highway","default_image_id":0,"font":"","enabled":false},"version":2},"jetpack_post_was_ever_published":false},"categories":[1],"tags":[691818270,691818340,691818879],"class_list":{"0":"post-256155","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","6":"hentry","7":"category-uncategorized","8":"tag-contracts-for-difference-cfd","9":"tag-offshore-wind-farms","10":"tag-wind-farm","12":"fallback-thumbnail"},"jetpack_publicize_connections":[],"jetpack_featured_media_url":"https:\/\/i0.wp.com\/climatescience.press\/wp-content\/uploads\/2023\/05\/0what-is-CFD.jpg?fit=1200%2C600&ssl=1","jetpack_likes_enabled":true,"jetpack_sharing_enabled":true,"jetpack_shortlink":"https:\/\/wp.me\/paxLW1-14Dx","jetpack-related-posts":[{"id":363795,"url":"https:\/\/climatescience.press\/?p=363795","url_meta":{"origin":256155,"position":0},"title":"Record \u00a32.4 Billion in CfD Subsidies Paid Out in 2024","author":"uwe.roland.gross","date":"29\/01\/2025","format":false,"excerpt":"Hot on the heels of the record payments made under the Feed-in-Tariff scheme in the year to end March 2024, the data is now available for subsidies paid under the Contract for Difference Scheme (CfDs) in calendar year 2024. The data comes from the Low Carbon Contract Company (LCCC). The\u2026","rel":"","context":"In \"Contract for Difference Scheme (CfDs)\"","block_context":{"text":"Contract for Difference Scheme (CfDs)","link":"https:\/\/climatescience.press\/?tag=contract-for-difference-scheme-cfds"},"img":{"alt_text":"","src":"https:\/\/i0.wp.com\/climatescience.press\/wp-content\/uploads\/2025\/01\/0Untitled-design.jpg?fit=1200%2C675&ssl=1&resize=350%2C200","width":350,"height":200,"srcset":"https:\/\/i0.wp.com\/climatescience.press\/wp-content\/uploads\/2025\/01\/0Untitled-design.jpg?fit=1200%2C675&ssl=1&resize=350%2C200 1x, https:\/\/i0.wp.com\/climatescience.press\/wp-content\/uploads\/2025\/01\/0Untitled-design.jpg?fit=1200%2C675&ssl=1&resize=525%2C300 1.5x, https:\/\/i0.wp.com\/climatescience.press\/wp-content\/uploads\/2025\/01\/0Untitled-design.jpg?fit=1200%2C675&ssl=1&resize=700%2C400 2x, https:\/\/i0.wp.com\/climatescience.press\/wp-content\/uploads\/2025\/01\/0Untitled-design.jpg?fit=1200%2C675&ssl=1&resize=1050%2C600 3x"},"classes":[]},{"id":288260,"url":"https:\/\/climatescience.press\/?p=288260","url_meta":{"origin":256155,"position":1},"title":"Offshore Wind Costs","author":"uwe.roland.gross","date":"20\/11\/2023","format":false,"excerpt":"The UK government has increased the strike price caps for the upcoming Contracts for Different round and committed to an offshore wind-only pot. The Administrative Strike Price for fixed-foundation bidders in Allocation Round 6 will be \u00a373 per megawatt-hour, up 66% on the \u00a344\/MWh in AR5 that failed to attract\u2026","rel":"","context":"In \"\u00a311 billion a year\"","block_context":{"text":"\u00a311 billion a year","link":"https:\/\/climatescience.press\/?tag=11-billion-a-year"},"img":{"alt_text":"","src":"https:\/\/i0.wp.com\/climatescience.press\/wp-content\/uploads\/2023\/11\/image-483.png?fit=1200%2C1063&ssl=1&resize=350%2C200","width":350,"height":200,"srcset":"https:\/\/i0.wp.com\/climatescience.press\/wp-content\/uploads\/2023\/11\/image-483.png?fit=1200%2C1063&ssl=1&resize=350%2C200 1x, https:\/\/i0.wp.com\/climatescience.press\/wp-content\/uploads\/2023\/11\/image-483.png?fit=1200%2C1063&ssl=1&resize=525%2C300 1.5x, https:\/\/i0.wp.com\/climatescience.press\/wp-content\/uploads\/2023\/11\/image-483.png?fit=1200%2C1063&ssl=1&resize=700%2C400 2x, https:\/\/i0.wp.com\/climatescience.press\/wp-content\/uploads\/2023\/11\/image-483.png?fit=1200%2C1063&ssl=1&resize=1050%2C600 3x"},"classes":[]},{"id":344739,"url":"https:\/\/climatescience.press\/?p=344739","url_meta":{"origin":256155,"position":2},"title":"Renewables Subsidies Hit New August Record","author":"uwe.roland.gross","date":"01\/10\/2024","format":false,"excerpt":"The Low Carbon Contract Company (LCCC) manages the Contracts for Difference (CfD) subsidy scheme and\u00a0publishes data\u00a0to show how much it costs us. The data is usually published about 10 days in arrears and sometimes is adjusted. 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According to a new analysis, the taxpayer could be half-a-billion pounds worse off due to a recently revealed delay at just one wind farm The Government has urged developers to \u201cact fairly\u201d after some of the UK\u2026","rel":"","context":"Similar post","block_context":{"text":"Similar post","link":""},"img":{"alt_text":"","src":"https:\/\/i0.wp.com\/climatescience.press\/wp-content\/uploads\/2022\/05\/0image-11.png?fit=1024%2C448&ssl=1&resize=350%2C200","width":350,"height":200,"srcset":"https:\/\/i0.wp.com\/climatescience.press\/wp-content\/uploads\/2022\/05\/0image-11.png?fit=1024%2C448&ssl=1&resize=350%2C200 1x, https:\/\/i0.wp.com\/climatescience.press\/wp-content\/uploads\/2022\/05\/0image-11.png?fit=1024%2C448&ssl=1&resize=525%2C300 1.5x, https:\/\/i0.wp.com\/climatescience.press\/wp-content\/uploads\/2022\/05\/0image-11.png?fit=1024%2C448&ssl=1&resize=700%2C400 2x"},"classes":[]},{"id":373587,"url":"https:\/\/climatescience.press\/?p=373587","url_meta":{"origin":256155,"position":4},"title":"New Strike Prices Confirm Offshore Wind Is Much Dearer Than\u00a0Gas","author":"uwe.roland.gross","date":"04\/04\/2025","format":false,"excerpt":"Of particular interest are the contracts offered in last summer\u2019s AR6 round. Offshore wind, for example, has been uplifted to \u00a384.97\/MWh.","rel":"","context":"In \"Catalyst Energy report\"","block_context":{"text":"Catalyst Energy report","link":"https:\/\/climatescience.press\/?tag=catalyst-energy-report"},"img":{"alt_text":"","src":"https:\/\/i0.wp.com\/climatescience.press\/wp-content\/uploads\/2025\/04\/0UK-offshore-wind-farm-Christopher-FurlongGetty-Images-scaled-1.jpg?fit=1200%2C636&ssl=1&resize=350%2C200","width":350,"height":200,"srcset":"https:\/\/i0.wp.com\/climatescience.press\/wp-content\/uploads\/2025\/04\/0UK-offshore-wind-farm-Christopher-FurlongGetty-Images-scaled-1.jpg?fit=1200%2C636&ssl=1&resize=350%2C200 1x, https:\/\/i0.wp.com\/climatescience.press\/wp-content\/uploads\/2025\/04\/0UK-offshore-wind-farm-Christopher-FurlongGetty-Images-scaled-1.jpg?fit=1200%2C636&ssl=1&resize=525%2C300 1.5x, https:\/\/i0.wp.com\/climatescience.press\/wp-content\/uploads\/2025\/04\/0UK-offshore-wind-farm-Christopher-FurlongGetty-Images-scaled-1.jpg?fit=1200%2C636&ssl=1&resize=700%2C400 2x, https:\/\/i0.wp.com\/climatescience.press\/wp-content\/uploads\/2025\/04\/0UK-offshore-wind-farm-Christopher-FurlongGetty-Images-scaled-1.jpg?fit=1200%2C636&ssl=1&resize=1050%2C600 3x"},"classes":[]},{"id":199591,"url":"https:\/\/climatescience.press\/?p=199591","url_meta":{"origin":256155,"position":5},"title":"Total Failure: Britain\u2019s Grand \u2018Cheap\u2019 Wind Power Plan Faces Total Collapse","author":"uwe.roland.gross","date":"13\/05\/2022","format":false,"excerpt":"If wind power is so \u2018cheap\u2019, then why is it that retail power prices continue to rocket in every country attempting to run on breezes? 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