See these docs: https://commonsbusiness.parliament.uk/2026-07-07

(Story Under Preparation)

Context — official document, unedited

Part One: Explanation, and context, of the Instrument Overview of the Instrument

What does the legislation do?

This instrument amends the Contracts for Difference (CfD) legislative framework to enable a CfD to be offered to an existing nuclear generating station to support the continuation of generation.

Where does the legislation extend to, and apply?

The extent of this instrument (that is, the jurisdictions which the instrument forms part of the law of) is England and Wales, Scotland and Northern Ireland.

The territorial application of this instrument (that is, where the instrument produces a practical effect) is England and Wales, Scotland and Northern Ireland.

Policy Context

What is being done and why?

This amendment enables the use of CfDs as a potential mechanism to support the continued operation of existing nuclear generating stations. The amendment expands the scope of nuclear plants eligible for CfD support so that, where appropriate, existing nuclear generating stations may access a long-term revenue stabilisation mechanism to extend their operational life.

The instrument is enabling in nature and does not mandate the award of CfDs to any individual nuclear generating station. Any future decision to award a CfD under the amended framework would be subject to a separate, project-specific assessment, including value-for-money, subsidy control, safety, environmental and regulatory considerations. 5.2 5.3 5.4 5.5 6. 6.1 6.2 6.3

The UK’s existing nuclear fleet provides a significant proportion of firm, low-carbon electricity generation, contributing to energy security and system resilience. The current fleet consists of 8 Advanced Gas Cooled Reactors (AGRs), the last of which is due to be retired by the early 2030s, and the Pressurised Water Reactor at Sizewell B, currently expected to operate until 2035 with the potential for a further extension.

Extending the operation of these assets, where it can be done safely and costeffectively, can help maintain security of supply, support delivery of the UK’s statutory carbon budgets, and reduce reliance on higher-carbon or more costly replacement capacity.

What was the previous policy, how is this different?

Prior to this amendment, existing nuclear generating stations were eligible for CfD support only where they were intending to increase the capacity of the station by 5 megawatts or more.

The CfD framework was designed primarily to support new low-carbon generation technologies, including renewables and new nuclear, and has also been used to support repowering projects such as wind farm repowering. Section 18 of the Energy Prices Act 2022 amended the Energy Act 2013 to make clear that CfDs could be used to support the continuation of low-carbon electricity generation by existing generating stations. This amendment is enabling and concerns eligibility only: it allows existing nuclear generating stations to be considered for CfD eligibility for the purpose of supporting the continuation of generation.

It does not mandate the award of a CfD to any station, and it does not alter the objectives, structure or safeguards of the CfD regime. Legislative and Legal Context How has the law changed? Section 10 of the Energy Act 2013 allows the Secretary of State to direct a CfD Counterparty to offer a CfD to a generator on terms specified in the notice direction.

The Low Carbon Contracts Company, (“LCCC”) has been designated as the CfD Counterparty. A CfD can only be offered to an “eligible generator”. This is defined in regulation 3 of the Contracts for Difference (Definition of Eligible Generator) Regulations 2014, which defines an eligible generator as a person who intends to carry out a generating activity in relation to an eligible generating station.

This instrument expands the scope of the definition of an eligible generator by amending the definition of “carry out a generating activity” so that it includes an existing nuclear power station continuing to generate electricity. The instrument does not alter nuclear safety, environmental protection or regulatory oversight arrangements. Existing statutory and regulatory requirements continue to apply, including oversight by the Office for Nuclear Regulation, and relevant environmental regulators. Why was this approach taken to change the law? This is the only possible approach to make the necessary changes. CO/EM/2026.1 2