Capacity Market and EMR dispute resolution

In 2013, the government introduced a policy of Electricity Market Reform (EMR) to incentivise investment in secure, low-carbon electricity, improve the security of Great Britain’s electricity supply, and improve affordability for consumers.

EMR was a part of The Energy Act 2013 and introduced a number of mechanisms. In particular:

• A Capacity Market (CM), designed to help ensure security of electricity supply at the least cost to the consumer.
• Contracts for Difference (CfD), designed to provide long-term revenue stabilisation for new low carbon initiatives. 

Capacity Market

The Capacity Market (CM) is governed by the Electricity Capacity Regulations 2014 (the Regulations) and the CM Rules.

The regulations provide the overarching policy and design, including the powers the Secretary of State (SoS) holds in overseeing the CM. The CM Rules provide the detail for implementing the operating framework set out in the Regulations

We manage and make any changes to the CM Rules through our CM Rules change process. You can find more information and a change proposal form in our CM rules change guidance.

Capacity Market and Contracts for Difference dispute resolution

National Grid Electricity System Operator (NGESO) is the EMR Delivery Body, responsible for administering key elements of the Capacity Market and the Contacts for Difference regime.

Appellants can ask NGESO to review certain decisions by raising a Tier 1 dispute. Where NGESO upholds its original decision, the appellant can ask us to consider that decision and make a determination. This is known as a Tier 2 dispute.

If you wish to appeal against an NGESO Tier 1 dispute decision relating to the CM or CfD, please read our EMR Dispute Resolution Guidance.

You must raise a Tier 2 dispute within five working days of receiving notice of NGESO’s Tier 1 dispute decision (note that ‘working days’ end at 5pm). 

Please see the Electricity Capacity Regulations 2014 and the Contracts for Difference (Allocation) Regulations 2014 for further information.