UK non-commodity charge · Renewables and capacity · Electricity
CfD supplier obligation levy
Latest published rate, who sets it, and where it is forecast to go.
What CfD supplier obligation levy is, who sets the rate, what the revenue funds and where it is heading. Rates come from the Purely Energy non-commodity cost data hub; forecasts are our own.
Roughly 3 to 6% of a typical UK business electricity bill
CfD supplier obligation levy: what it is, who charges it, and what it pays for
What it is
The CfD supplier obligation levy charge in plain English
The government’s main mechanism for building new wind farms and solar. Generators get a guaranteed strike price; consumers pay the gap vs wholesale prices. Quarterly levy.
Introduced 2014 (Energy Act 2013). Rising fast as more offshore wind comes online.
Who charges it
The body that sets the rate
LCCC, quarterly Interim Levy Rate (ILR)
Unit
p/kWh
Applies to
All electricity supplies
What it pays for
Where the revenue ends up
New offshore wind, solar farms, nuclear (Hinkley Point C)
Share of typical bill
3 to 6%
LCCC's quarterly Interim Levy Rate determines the CfD supplier obligation; recent quarters have placed it at 3 to 6% of a non-domestic electricity bill.
Published rate history
| Financial year | Rate | Year on year | Source |
|---|---|---|---|
| 2020/21 | 0.3820p/kWh | - | Published |
| 2021/22 | 0.1660p/kWh | -56.5% | Published |
| 2022/23 | -0.0560p/kWh | -133.7% | Published |
| 2023/24 | 0.2500p/kWh | -546.4% | Published |
| 2024/25 | 0.5500p/kWh | +120.0% | Published |
| 2025/26 | 0.8460p/kWh | +53.8% | Published |
Forecast trajectory
Forecasts from our non-commodity cost model. P10, P50 and P90 are the 10th, 50th and 90th percentile outcomes; P50 is the central estimate.
| Year | P10 | P50 | P90 | Confidence | Rationale |
|---|---|---|---|---|---|
| 2025-26 | 0.7000 | 0.8460 | 1.000 | high | Based on LCCC published rates with minimal uncertainty |
| 2026 | - | 1.044 | - | - | |
| 2026-27 | 1.000 | 1.220 | 1.500 | high | AR6 projects commissioning with known strike prices |
| 2027 | - | 1.200 | - | - | |
| 2027-28 | 1.200 | 1.530 | 1.900 | med | Remaining AR6 capacity with wholesale price uncertainty |
| 2028 | - | 1.350 | - | - | |
| 2028-29 | 1.300 | 1.740 | 2.200 | med | AR7 assumptions with moderate wholesale price risk |
| 2029 | - | 1.300 | - | - | |
| 2029-30 | 1.100 | 1.710 | 2.400 | med | Pipeline completion with policy uncertainty emerging |
| 2030 | - | 1.200 | - | - | |
| 2030-31 | 0.9000 | 1.600 | 2.500 | low | High uncertainty on post-2030 allocation rounds |
| 2031 | - | 1.071 | - | - | |
| 2031-32 | 0.6000 | 1.200 | 2.100 | low | Highly uncertain due to unknown regulatory changes |
| 2032 | - | 1.092 | - | - | |
| 2032-33 | 0.4000 | 0.9400 | 1.800 | low | Speculative due to wholesale price and policy unknowns |
| 2033 | - | 1.114 | - | - | |
| 2033-34 | 0.4000 | 1.050 | 2.000 | low | Placeholder estimate with extreme uncertainty |
| 2034 | - | 1.137 | - | - | |
| 2034-35 | 0.3500 | 1.240 | 2.350 | low | Rate could vary significantly due to regulatory changes |
CfD supplier obligation levy FAQs
What is the CfD supplier obligation levy charge?
The government’s main mechanism for building new wind farms and solar. Generators get a guaranteed strike price; consumers pay the gap vs wholesale prices. Quarterly levy.
Who sets the CfD supplier obligation levy rate?
The CfD supplier obligation levy rate is set by LCCC, quarterly Interim Levy Rate (ILR).
What does CfD supplier obligation levy pay for?
CfD supplier obligation levy revenue supports New offshore wind, solar farms, nuclear (Hinkley Point C).
What is the latest published CfD supplier obligation levy rate?
For 2025/26, the published CfD supplier obligation levy rate is 0.8460 p/kWh.
What is the CfD supplier obligation levy forecast?
Our latest forecast for 2026-27 is 1.220 p/kWh (high confidence). AR6 projects commissioning with known strike prices
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Rate data from the Purely Energy non-commodity cost data hub (dh.purelyenergy.co.uk). Published rates come from statutory publications by the body listed above; forecasts are modelled from published guidance and market trends, so treat P50 as a central estimate and use P10/P90 for sensitivity. Primary source