Decision: capacity market allowance in the default tariff cap
- Supply and Retail Market
- Generation and Wholesale Market
On 15 January 2019, we issued an open letter about the Capacity Market (CM) allowance in the default tariff cap. We set out potential options for the CM allowance in the second cap period, which will run from 1 April to 30 September 2019. This reflected the uncertainty about whether and when suppliers would be required to make CM payments in relation to this cap period.
This letter sets out our decision. This affects the level of the cap for the second cap period, which we have published today.
We have decided to include a full CM allowance in the second cap period. This allowance covers the costs associated with the CM Supplier Charge, as well as the administrative costs of the CM scheme.