Economics at your fingertips  

Determining commercially viable two-way and one-way ‘Contract-for-Difference’ strike prices and revenue receipts

Phillip Wild

Energy Policy, 2017, vol. 110, issue C, 191-201

Abstract: In this article, we investigate the role that a Contract-for-Difference (CFD) might play in increasing investment in renewable energy in Australia. Two CFD schemes are investigated: two-way and one-way CFD. A financial model is developed that determines commercially viable CFD strike prices. Account is taken of revenue from wholesale electricity market and renewable energy certificate sales. Capital and operational costs of the project including distribution of funds to holders of equity and debt are also included. Findings based on analysis of the solar array located at the University of Queensland Gatton Campus in Australia is presented, employing a typical meteorological year framework. The major finding was that Government will prefer a two-way CFD scheme and Single-Axis tracking solar PV array technology. In contrast, project proponents will strongly prefer a one-way CFD design.

Keywords: Contract for difference; Feed-in tariff; Solar PV; Operation and maintenance costs; Renewable energy policy (search for similar items in EconPapers)
Date: 2017
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (7) Track citations by RSS feed

Downloads: (external link)
Full text for ScienceDirect subscribers only

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link:

DOI: 10.1016/j.enpol.2017.08.020

Access Statistics for this article

Energy Policy is currently edited by N. France

More articles in Energy Policy from Elsevier
Bibliographic data for series maintained by Catherine Liu ().

Page updated 2024-02-12
Handle: RePEc:eee:enepol:v:110:y:2017:i:c:p:191-201