The Capacity Market Has Been Reinstated

capacity market reinstated

We previously informed that the Capacity Market (CM) had been suspended, pending the final ruling in an ongoing case between Tempus Energy and the UK Government. This case has now concluded.

On 25 October 2019, this statement from the government’s official website advised:

“The European Commission has confirmed its original decision in 2014 to grant state aid approval for the Capacity Market, enabling it to be restored and payments that have been suspended since November 2018 to be made.

The Secretary of State for Business, Energy and Industrial Strategy has written to National Grid Electricity System Operator (ESO) and the Electricity Settlements Company (ESC) to notify them of the Commission’s decision and confirm that the trigger for the resumption of capacity payments has occurred.

These bodies are required to restart all Capacity Market functions that had been suspended during the standstill period.”

What happens now?

Suppliers will now need to make full payments for their share of the Capacity Market, meaning that customers should expect to see CM pass-through charges on their bills again. This will only affect customers who have this charge as a pass-through (separated from their billable unit rate).

However, some suppliers had pre-empted the reinstatement of the Capacity Market and have already billed customers for the charges incurred to date. As such, these customers would have already paid their CM charges for that period (November 2018 – February 2019).

Are your charges correct?

There will be a reconciliation of the forecasted CM charges when the actual charges have been finalised so some customers should expect to see a credit if the final rate of the actual charge is lower.

Pulse Business Energy will continue to monitor these developments closely and we can ensure that bills are accurate via our Bill Validation service.

To benefit from the Bill Validation service or to get additional information, please Contact Us.