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Energy

Energy and Climate Change written question – answered on 11th July 2012.

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Photo of Phillip Lee Phillip Lee Conservative, Bracknell

To ask the Secretary of State for Energy and Climate Change what assessment he has made of counterparty risks in the draft Energy Bill's multiparty contract model; and whether he plans to make further assessments of the single counterparty model.

Photo of Charles Hendry Charles Hendry The Minister of State, Department of Energy and Climate Change

In developing the Contracts for Difference payment model set out in the draft Energy Bill and draft Operational Framework in May 2012, we have engaged with a wide range of stakeholders to assess any risks associated with the proposed model. We have also considered external legal advice.

While I still believe that the proposed model is workable, I recognise the concerns that have been raised by industry. For that reason, I have been assessing the viability of alternative models, including those based on a single counter-party.

I await the outcome of the Energy and Climate Change Committee's pre-legislative scrutiny before making a decision on whether to make any changes in the Bill.

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