Contracts for Difference Feed In Tariff (CfD FiT)

Contracts for Difference form a major part of the EMR. EMR aims to deliver consistent, low-carbon
energy which is needed within the UK. The scheme, open to generators over 5MW, is set to replace
Renewables Obligation (RO). As it stands the Department of Energy and Climate Change (DECC) are
set to replace RO with CfD Fit from 31st March 2017 for new developments and RO shouldn’t go
beyond 2037.

During this period of transition customers will be invoiced for both RO and CfD FiT.

The costs for this scheme is to be recovered from all licensed electricity suppliers based on their
market share. The charges will commence from 1st January 2015.

Charges are invoiced on a daily basis, with quarterly and annual reconciliations and is managed by
the Low Carbon Contracts Company (LCCC), a private company owned by DECC.

The Capacity Market

The Capacity Market (CM) is another key feature of EMR. The main aim for CM is to maintain the
security of supply by making payments to keep steady sources of generation capacity on stream.

The main charges are to cover the payments made to generators and also to recover operational
costs of the Electricity Settlement Company (ESC).

These costs are to be recovered from all licensed electricity suppliers.

From May 2015 these costs will appear on your electricity invoices.

If you have any questions or require further information please see www.gov.uk, www.ofgem.co.uk,
www.lowcarboncontracts.uk, www.emrdeliverybody.com or call us on 01524 590000.