Episode 8 | The ABCs of CfDs: Demystifying and designing Contracts for Difference

The eighth episode of the ‘FSR Policy Briefcase’ breaks down the subject of ‘contracts for difference’ or ‘CfD’s’ in the renewable electricity sector and explores some of the ways that innovative designs can help accelerate the energy transition.

For this episode, regular hosts Leonardo Meeus and James Kneebone are joined by part-time FSR Professor and full-time DTU Professor, Lena Kitzing. The conversation takes as a point of departure the recent publication of Lena’s Technical Report on this subject, co-authored with Anne Held, Malte Gephart, Fabian Wagner, Vasilios Anatolitis, and Corinna Klessmann.
This episode builds on our previous two episodes with Leigh Hancher and Jean-Michel Glachant, which focused on different kinds of public and private ‘long-term contracts’ in general, including CfD’s. In this conversation we discuss the history of CfD’s, their relationship to other forms of long-term contracts and incentives within the renewable energy space, as well as the role of ‘two-sided’ CfD’s in mitigating the damage of the recent energy crisis. Looking to the future, Lena outlines some other technologies where she feels CfD’s might prove useful, including for energy storage, as well as sharing some of her views on potential future design innovations for the renewables sector!

The full report can be found here: https://cadmus.eui.eu/handle/1814/76700;jsessionid=C6C7EADB8A166005F29DFD28A8AFBB44