Published 21 February 2025
Last updated 15 July 2025 — See all updates
This consultation has concluded
Read the full outcome
Further reforms to the CfD
scheme for AR7: government response to policy proposals
(published July 2025)
Further reforms to the CfD
scheme for AR7: government response to policy proposals
(published July 2025 - accessible webpage)
Further reforms to the Contracts
for Difference scheme for Allocation Round 7: Final stage impact
assessment (July 2025)
Detail of outcome
We split the government responses to this consultation, to allow
legislative changes to be implemented before Allocation Round 7
(AR7) opens this summer.
The initial government response covers
those elements requiring legislation and summarises responses to
the 11 questions in the consultation on:
- amending the Contract Budget Notices
- enabling Secretary of State to have access to anonymised bid
information before setting the final budget
- an amendment to the Clean Industry Bonus payment methodology
to ensure the energy price cap is accurate
The second, final government
response covers all remaining proposals and sets
out the government's decisions on each section:
- Section 1 - to set appropriate budget and auction parameters
to facilitate the government's intention to support multiple test
and demonstration scale floating offshore wind projects in
AR7
- Section 2.1 - to implement the government's proposal to relax
eligibility requirements to allow fixed-bottom offshore wind
projects to apply for a CfD while awaiting full
planning consent. The government has decided to adopt an amended
eligibility threshold, so that 12 months must have passed between
the project reaching the relevant planning stage and the
CfD application
deadline
- Section 2.2 - to use new regulatory powers to change the
information the Secretary of State uses to inform the final
budget. For fixed-bottom offshore wind, the budget will be
published before the sealed bid window; only bid information on
projects that breach the budget level will be viewed by Secretary
of State; and a budget increase will only be considered if there
is a benefit to consumers
- Section 2.3 - to increase the length of new CfD contracts from 15 to 20
years for fixed-bottom offshore wind, floating offshore wind,
onshore wind and solar technologies
- Section 3.1 - to increase the length of the Target
Commissioning Window for Solar PV from 3 to 12 months
- Section 3.2 - to implement a temporary restriction on
CfD capacity
surrendered from previous allocation rounds being entered into
AR7
- Section 4.1 - to implement the proposed contract and rule
changes to allow repowered onshore wind projects to access
CfD support
- Section 4.2 - to implement the proposed contract changes to
extend phasing to floating offshore wind
- Section 5.1 - to implement the proposed contract changes
relating to the establishment of the National Energy System
Operator (NESO)
- Section 5.2 - to implement the proposed contract changes
relating to Clean Industry Bonus payment suspensions
Detail of feedback received
We received 119 consultation responses from:
- a mixture of companies active in the energy sector (including
developers, generators and suppliers)
- trade associations and bodies
- investors
- consultancies
- not-for-profit public campaign groups
- individual members of the public
Original consultation
Summary
We're seeking views on potential changes for Allocation Round 7
(AR7), due to open in summer 2025, and providing policy updates.
This consultation ran from
11am on 21 February 2025 to 11:59pm on 21 March
2025
Consultation description
Contracts for Difference (CfD) scheme is government's
main support mechanism for new low carbon electricity generation
projects in Great Britain. The government continuously reviews
the CfD scheme to
ensure it remains fit-for-purpose as our electricity system
evolves and we work towards our net zero ambitions.
This consultation invites views on potential changes for
Allocation Round 7 (AR7)
(due to open in summer 2025), including:
- a relaxation of CfD eligibility criteria for
fixed‑bottom offshore wind projects to permit projects that have
not yet obtained full planning consents to participate in
near-term allocation rounds
- changes to the information the Secretary of State uses to
inform the final budget for fixed‑bottom offshore wind, including
greater visibility over sealed bid information
- changes to CfD
contract terms that would give longer market certainty once
contracts are awarded, including consideration of the merits of
increasing the current 15-year CfD term to reduce overall
project costs
- implementing agreed policy changes and routine changes.
The document also provides policy updates.
We welcome responses from anyone with an interest in the
proposals, including those considering participating in
AR7 and future
CfD rounds.
Documents
Further reforms to the Contracts
for Difference scheme for Allocation Round 7: consultation
document
DRAFT: Contracts for Difference
Allocation Round 7: Standard terms and conditions
DRAFT: Contracts for Difference
Allocation Round 7: Generic Agreement
DRAFT: Contracts for Difference
Allocation Round 7: (Phase 1) (Apportioned)
Agreement
DRAFT: Contracts for Difference
Allocation Round 7: Private Network Agreement
