ABSTRACT
Renewable electricity generation was supported by a market enablement programme for the first time in the UK as part of privatization. Renewable energy projects were able to obtain a premium price per kwh of generation if they were successful in their application for a contract under the non-fossil fuel obligation (NFFO). The subsidy is the difference between the average monthly Pool price and the premium price. The NFFO obliged the regional electricity companies (RECs) to take a certain amount of nuclear and renewable electricity. The renewable NFFO was to be made up of five Orders or tranches of contracts between 1990 and 1998. Together these Orders were intended to fulfil the Government's policy of working towards 600 MW declared net capacity @NC), later revised first to 1000 MW DNC and then 1500 MW DNC, of new renewable capacity by 2000. This target is essentially an arbitrary and political figure, and it is the major determinant of the subsidy paid over time.
