One of the main reasons I joined this project is to try and take some control over my energy by protecting myself against market spikes that occur in energy prices (particularly after increasing the price cap) - from what I can see the CfD removes that option. My concerns are that the CfD only protects the downside risk if the market drops (which looks to be a differential of circa 8p / KWh from an April 2021 low), but it leaves us exposed if the electricity market surges (a differential of 67p / KWh from it's Aug 2022 peak).
From what I can see, although we are looking at a moderate reduction in electricity prices this year which will reduce our return, we would be locked into this Contract for 15 years which removes the protection from increased electricity price spikes the scheme affords us (even if it is CPI linked). Regardless of your views on fossil fuels, the government has already announced that it intends to utilise more liquid natural gas (LNG) generators going forward so LNG will also likely increase in price from its current lows. As gas prices are linked to electricity prices, if the LNG price increases, electricity prices will move upward accordingly - if there are problems accessing LNG there will likely be volatility in these markets which could very likely lead to price spikes, these are more likely to happen in an increasingly volatile geopolitical environment.
I can see why the lenders would like to see a CfD in place as it removes downside risk from their investment and guarantees their returns but I'm not sure how much this really benefits us...
I am however willing to listen to other views and be convinced otherwise...