CfDs to support renewables: the devil is in the details

• Robert Schuman Centre for Advanced Studies
• FSR: Florence School of Regulation

Developments in the European energy and climate policy

Contracts for Difference (CfDs) have been acknowledged by EU legislation as a fundamental tool to support the rapid uptake of renewable energy sources necessary to achieve the 2030 energy and climate targets. Discussions on how to properly design those contracts and how their massive use will impact the functioning of electricity markets have been common in the past few years, sometimes without a consensus emerging among researchers and policymakers. 

In this new instalment of the FSR Insights series on Developments in the European energy and climate policy , FSR part-time professor Lena Kitzing will provide her view on those discussions and illustrate the key messages of a recent FSR technical report, where she and her co-authors highlight how CfDs can come in many shapes and how hard it is to generalise about them. By referring to some concrete examples, Prof. Kitzing will show how the selection of alternative design options can lead to different results and that those results depend also on the specific context in which such a CfD is applied. 

Sofia Nicolai from the FSR will discuss Prof. Kitzing's contribution before opening the floor to answer questions from the audience.