Capacity Market (CM) Rules

The government has established the Capacity Market (CM) as part of its Electricity Market Reform policy. It is intended to incentivise investment in more sustainable, low-carbon electricity capacity at the least cost for energy consumers. This is needed to help secure electricity supplies for the future.

Our role in the CM

The 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) will hold in overseeing the CM. The Rules have been made by the SoS and provide the practical detail on how the CM will operate under the Regulations. They cover the:

  • details on the contents of capacity agreements
  • obligations of capacity agreement holders, including penalties
  • technical operation of the Capacity Market.

Under the government’s reform of the electricity market, our regulatory duties have been extended to include managing and making any changes to the CM Rules after the results of the first capacity auction.

CM Rules change proposal submissions

Between 29 September 2015 and 15 January 2016, we began accepting change proposals. This was so they could be considered before the 2016 T-4 pre-qualification round.

Proposals submitted after 15 January 2016 will be held for later consideration, before the 2017 pre-qualification rounds, unless they are urgent.

You can find out how we will manage changes to the rules and download the change proposal form in our CM Rules change process guidance page.

Submitted change proposals can be found on our Capacity Market Rules Change Proposals page.

What else?

The Department of Energy and Climate Change (DECC) (now the Department for Business, Energy and Industrial Strategy), published some changes to the CM Rules which came into force on 21st July 2016. These followed consultations held in autumn 2015.

We incorporated DECC's changes alongside our own amendments which we published on 14 July 2016. The latest consolidated version of the Rules can also be found at the link on this page under 'Related information'.

Publications and updates

  • Published: 23rd Mar 2017
  • Closed: 5th May 2017
  • Consultations & responses
  • 41 Associated documents
This consultation invites stakeholder views on our proposed amendments to the Capacity Market Rules 2014 (“the Rules”).

  • Published: 24th Nov 2016
  • Open letters & correspondence
  • 1 Associated documents
Our annual window for accepting change proposals to the Capacity Market (CM) Rules closed on 11 November 2016. We received 75 proposals.

  • Published: 17th Nov 2016
  • Decisions
  • 1 Associated documents
This letter sets out our decisions on proposed changes to the Capacity Market Rules (the “Rules”) pursuant to Regulation 77 of the Electricity Capacity Regulations 2014 (the “Regulations”).

  • Published: 15th Sep 2016
  • Open letters & correspondence
  • 1 Associated documents
This letter invites proposals for changes to the Capacity Market Rules, invites comments on our revised guidelines, and provides an update on any proposals under consideration.

  • Published: 24th Aug 2016
  • Guidance
  • 1 Associated documents
This document sets out clarifications to the Capacity Market Rules where necessary.

  • Published: 21st Jul 2016
  • Closed: 19th Aug 2016
  • Consultations & responses
  • 12 Associated documents
This is our consultation on further amendments to the Capacity Market Rules.

  • Published: 14th Jul 2016
  • Open letters & correspondence
  • 1 Associated documents
See a schedule of the Capacity Market (Amendment) (No 2) Rules 2016.

  • Published: 5th Jul 2016
  • Decisions
  • 4 Associated documents
This letter sets out our decisions on changes to the Capacity Market Rules (the “Rules”) pursuant to Regulation 77 of the Electricity Capacity Regulations 2014 (the "Regulations").

  • Published: 29th Apr 2016
  • Closed: 27th May 2016
  • Consultations & responses
  • 26 Associated documents
This is our consultation on the amendments to the Capacity Market Rules.

  • Published: 1st Mar 2016
  • Open letters & correspondence
  • 1 Associated documents
Our view on Supplemental Balancing Reserve and Demand Side Balancing Reserve for 2017/18 given government’s proposal to run a Capacity Auction for delivery in the same year.

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