Ed Davey (Liberal Democrat)

The Department for Energy and Climate Change requires a cash advance of \xA36,580,000 from the Contingencies Fund for financial year 2013-14, to support urgent preparatory work to set up a contracts for difference (CFD) counterparty; to fund a panel of technical experts; and to fund external advisers in relation to transitional arrangements for early investors before parliamentary approval of both the specific enabling legislation and the necessary estimate.

Contracts for difference (CFDS) are designed to ensure sufficient investment comes forward in time to replace old generating plant due to close from 2016 onwards with new low-carbon plant, thus ensuring continued security of supply for the UK and contributing significantly towards achievement of our legally binding EU renewable energy target.

Accordingly, parliamentary approval for additional resources of \xA36,580,000 for this new service will be sought in an estimate for the Department of Energy and Climate Change. Pending that approval, urgent expenditure estimated at \xA36,580,000 will be met by repayable cash advances from the Contingencies Fund.

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