Low Carbon Contracts Company and Electricity Settlements Company Operational costs 2021/22

Overview

We’re seeking views on the proposed 2021-22 operational cost budgets and resulting levies for the Low Carbon Contracts Company (LCCC) and the Electricity Settlements Company (ESC). 

Why your views matter

The LCCC enters into and manages Contracts for Difference (CfD) with low carbon electricity generators. The ESC is responsible for financial transactions relating to the Capacity Market, including making capacity payments to capacity providers, controlling collateral and managing auction bid bonds.

The operational costs of the companies are recovered through levies on electricity suppliers, as set out in legislation. Subject to the outcome of the consultation, the regulations will be amended, and the operational cost levies for 2021-22 will be reflected in secondary legislation, which is intended to be laid in Parliament in early 2021, to come into force (subject to the will of Parliament) before 1 April 2021.

What happens next

We will analyse responses and produce a Government response to this consultation, which we plan to publish in early 2021. Subject to the outcome of this consultation and Parliamentary approval, we will amend the relevant legislation to enable levies to be set for 2021/22.