The Electricity Capacity (No. 2) Regulations 2019

Amendments to the Electricity Capacity (No. 1) Regulations 2019

3.—(1) The Electricity Capacity (No. 1) Regulations 2019(1) are amended as follows.

(2) In regulation 2(1) (interpretation)—

(a) after the definition of “standstill period” insert—

““subsequent capacity auctions” means—

(a)

the T-1 auction for the delivery year commencing on 1st October 2020;

(b)

the T-3 auction; and

(c)

the T-4 auction for the delivery year commencing on 1st October 2023;”;

(b) in the definition of “T-1 auction” omit “and”;

(c) in the definition of “T-1 capacity agreement trigger event”, for “.” substitute “; and”;

(d) after the definition of “T-1 capacity agreement trigger event” insert—

““T-3 auction” has the meaning given in regulation 2(1) of the Principal Regulations; and

“T-4 auction” has the meaning given in regulation 2(1) of the Principal Regulations.”.

(3) In regulation 12 (interpretation: modifications)—

(a) in sub-paragraph (c), omit “and”;

(b) in sub-paragraph (d), for “.” substitute “; and”; and

(c) after sub-paragraph (d), insert—

“(e) “supplementary mutualisation payment” has the meaning given in regulation 7A(8) of the Supplier Payment Regulations.”.

(4) In regulation 20(2)(e) (applicant credit cover: modifications), in inserted paragraph (5A), for “by” substitute “from”.

(5) In regulation 41(2)(a)(iii) (termination fees: modifications) for “unproven demand side response CMU; and” substitute “capacity auction.”.

(6) After regulation 63 (calculation of amounts: modifications), insert—

“PART 7 Modifications to application of Principal Regulations: credit cover for subsequent capacity auctions

Subsequent capacity auctions: suspension of credit cover during standstill period

64.— (1) The modifications to the application of the Principal Regulations in regulations 12(b) and (d), 20(2), and 21 to 23 apply in relation to the subsequent capacity auctions (including the rights and obligations arising out of, or in relation to, those auctions) with the following modifications.

(2) Regulation 20(2)(e) applies as if—

(a) after “(2)(a)”, there were inserted “, (2B)”; and

(b) for “40” there were substituted “15”.

Subsequent capacity auctions: credit cover arrangements

65.   Regulation 59 (requirement to provide applicant credit cover) of the Principal Regulations applies in relation to the subsequent capacity auctions (including the rights and obligations arising out of, or in relation to, those auctions) and capacity agreements that existed on 15th November 2018 as if, after paragraph (1B), there were inserted—

“(1BA) This paragraph applies where—

(a) an applicant is required to provide applicant credit cover under paragraph (5A)(2) in respect of an unproven demand side response CMU or an interconnector CMU for a capacity auction which concluded prior to 15th November 2018 (“suspended credit cover”);

(b) the applicant has provided credit cover in respect of that CMU for—

(i) the T-1 auction for the delivery year commencing on 1st October 2020;

(ii) the T-3 auction; or

(iii) the T-4 auction for the delivery year commencing on 1st October 2023,

in accordance with this regulation (“subsequent credit cover”); and

(c) if the applicant had provided the suspended credit cover before the subsequent credit cover, the applicant would have been eligible to receive an exemption from the requirement to provide some or all of the subsequent credit cover pursuant to paragraph (1B) and capacity market rules.

(1BB) Where paragraph (1BA) applies subsequent credit cover provided by the applicant in respect of the CMU may, to the extent it would not have been required to be provided if an exemption had been obtained pursuant to paragraph (1B) and capacity market rules, instead, at the applicant’s request, and in accordance with capacity market rules, be treated thereafter as applicant credit cover which—

(a) was provided in relation to the applicant’s obligation to provide suspended credit cover under paragraph (5A) in respect of the CMU; and

(b) for the purposes of paragraph (1B), existed at the date on which the applicant was required to provide subsequent credit cover in respect of the CMU.””.

(1)

S.I. 2019/862.

(2)

Paragraph (5A) is read into regulation 59 of the Electricity Capacity Regulations 2014 by regulation 20(2)(e) of the Electricity Capacity (No. 1) Regulations 2019.