Despite the new terms of the agreement, there are risks that the support will not offer consumers value for money. The agreement was reached through bilateral negotiations with Drax and included no element of competition.56 While the government claims that the new arrangements will reduce consumer subsidies to Drax, it will be paid £113 per megawatt hour (in 2012 prices) for the electricity it generates–far more than will be paid to offshore windfarms and other renewable generators under rece...

Despite the new terms of the agreement, there are risks that the support will not offer consumers value for money. The agreement was reached through bilateral negotiations with Drax and included no element of competition.56 While the government claims that the new arrangements will reduce consumer subsidies to Drax, it will be paid £113 per megawatt hour (in 2012 prices) for the electricity it generates–far more than will be paid to offshore windfarms and other renewable generators under recent Contracts for Difference.57 After our evidence session, we received correspondence from Drax stating that it considers the strike price is justified b Type: conclusion | Number: 20 | Response status: not_addressed Government response: 3.1 The government disagrees with the Committee’s recommendation. 3.2 It is important to recognise that the proposed contract with Drax was not intended to set the path to the adoption of power BECCS for large-scale generation. 3.3 Rather, the priority was to sec