Direction to extend NGET's EMR delivery incentives in Special Condition 4L to the Early Capacity Auction
Decision
Publication date
Company
Industry sector
Generation and Wholesale Market
This direction sets out the Authority’s decision to modify Special Condition 4L to extend the demand forecasting and dispute resolution incentives to National Grid Electricity Transmission's (NGET) delivery of the Early Capacity Auction for delivery 2017-18. These incentives have been and continue to be important for incentivising NGET to produce adequate outputs in delivering Electricity Market Reform (EMR).
The dispute resolution incentivises NGET to devote the appropriate quality and quantity of resources to the decisions it made at the application and Tier 1 review stages for dispute resolution. The demand forecasting incentive, meanwhile, is crucial in ensuring lower costs to consumers due to a lower risk of under- or over-procurement of capacity.