The Electricity Capacity Regulations 2014

CHAPTER 4 E+W+S Payment and non-payment

General E+W+S

45.—(1) In this Chapter—

“draw down” has the same meaning as it has in Part 7;

“in default” means a failure to pay in full an invoiced amount by [F1 the end of] the payment due date;

“invoiced amount” means the total amount payable by a payer as stated in the invoice issued to that payer under regulation 41, 43 [F2 , 44 or 49A];

“payer” [F3 , subject to regulation 47(7),] means a person to whom an invoice is issued under regulation 41, 43 [F4 , 44 or 49A];

“payment due date” means the day specified in an invoice in accordance with regulation 38(2) as the date by which it is to be paid.

F5 (2) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F5 (3) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Textual Amendments

F1 Words in reg. 45(1) inserted (14.7.2016) by The Electricity Capacity (Amendment) Regulations 2016 (S.I. 2016/742), reg. 1(2), Sch. 1 para. 53(a)

F2 Words in reg. 45(1) substituted (18.7.2019) by The Electricity Capacity (No. 2) Regulations 2019 (S.I. 2019/1139), regs. 1(2), 2(7)(a)

F3 Words in reg. 45(1) inserted (18.12.2014) by The Electricity Capacity (Supplier Payment etc.) Regulations 2014 (S.I. 2014/3354), reg. 1(2), Sch. 2 para. 7

F4 Words in reg. 45(1) substituted (18.7.2019) by The Electricity Capacity (No. 2) Regulations 2019 (S.I. 2019/1139), regs. 1(2), 2(7)(b)

F5 Reg. 45(2)(3) omitted (14.7.2016) by virtue of The Electricity Capacity (Amendment) Regulations 2016 (S.I. 2016/742), reg. 1(2), Sch. 1 para. 53(b)

Payment of invoices and accruing interest E+W+S

46.—(1) A payer must pay the invoiced amount to the Settlement Body by no later than [F6 the end of] the payment due date.

(2) Where a payer has not paid in full the invoiced amount to the Settlement Body as required by paragraph (1), the payer must pay the Settlement Body simple interest at the rate specified in paragraph (4) (“late payment interest”) on the outstanding balance of the invoiced amount from and including the payment due date until the date of payment.

(3) Where a payer disputes an invoiced amount under Chapter 2 of Part 10—

(a) if the decision of the Settlement Body under that Part is that the invoiced amount is reduced but not extinguished, late payment interest accrues on the reduced amount from and including the payment due date until the date of payment;

(b) if the decision of the Settlement Body under that Part is that the invoiced amount is extinguished, no late payment interest accrues in respect of the invoiced amount.

(4) The rate at which late payment interest is payable is 5 per cent per annum over the Bank of England base rate in force on the 30th June (in respect of interest which starts to run between 1st July and 31st December) or the 31st December (in respect of interest which starts to run between 1st January and 30th June) immediately before the date on which the interest starts to run.

(5) In paragraph (4), “Bank of England base rate” means—

(a) the rate announced from time to time by the Monetary Policy Committee of the Bank of England as the official dealing rate, being the rate at which the Bank is willing to enter into transactions for providing short term liquidity in the money markets; or

(b) where an order under section 19 of the Bank of England Act 1998 M1 is in force, any equivalent rate determined by the Treasury under that section.

Textual Amendments

F6 Words in reg. 46(1) inserted (14.7.2016) by The Electricity Capacity (Amendment) Regulations 2016 (S.I. 2016/742), reg. 1(2), Sch. 1 para. 54

Marginal Citations

M1 1998 c.11.

The non-payment register E+W+S

47.—(1) The Settlement Body must maintain a register (“ the non-payment register”) which is to include in respect of a payer (“P”) who has not paid an invoice by [F7 the end of] the payment due date—

(a) the name of P;

(b) whether P is an electricity supplier or a capacity provider;

(c) the type of invoice in respect of which P is in default;

(d) the payment due date;

(e) the date or dates when any payment has been made by P in respect of the invoice, and whether it is a full or partial payment; and

(f) whether P has given a disputes notice to the Settlement Body in respect of the invoice;

(g) if P has given a disputes notice in respect of the invoice, whether the dispute has been determined under Chapter 2 of Part 10 and, if so, that determination.

(2) The matters included on the non-payment register under paragraph (1) are a “relevant register entry” in relation to P.

(3) The Settlement Body must—

(a) make a relevant register entry as soon as possible after P is in default; and

(b) update the relevant register entry if a payment is subsequently made, or a dispute is raised or determined.

(4) The Settlement Body must remove a relevant register entry—

(a) if it is determined under Chapter 2 of Part 10 that the payment is not due, as soon as reasonably practicable after the Settlement Body makes that determination;

(b) in any other case, 12 months after the date on which P became in default.

(5) The Settlement Body must publish the information contained in the non-payment register on a website.

(6) The Settlement Body must retain the data contained in a relevant register entry for 5 years after the relevant register entry is made.

[F8 (7) In this regulation, “payer” means a person to whom an invoice is issued under these Regulations or the Supplier Payment Regulations.]

Textual Amendments

F7 Words in reg. 47(1) inserted (14.7.2016) by The Electricity Capacity (Amendment) Regulations 2016 (S.I. 2016/742), reg. 1(2), Sch. 1 para. 55

F8 Reg. 47(7) inserted (18.12.2014) by The Electricity Capacity (Supplier Payment etc.) Regulations 2014 (S.I. 2014/3354), reg. 1(2), Sch. 2 para. 8

Payment of credit notes E+W+S

48.  Subject to regulations 49 to 52, the Settlement Body must pay the amount due to—

(a) each capacity provider issued with a credit note for a capacity payment, by no later than [F9 the end of the 33^rd] working day after the end of the month to which the payment relates; and

(b) each capacity provider issued with a credit note for an over-delivery payment, by no later than [F10 the end of the 33^rd] working day after the end of the delivery year to which the payment relates.

Textual Amendments

F9 Words in reg. 48(a) substituted (14.7.2016) by The Electricity Capacity (Amendment) Regulations 2016 (S.I. 2016/742), reg. 1(2), Sch. 1 para. 56

F10 Words in reg. 48(b) substituted (14.7.2016) by The Electricity Capacity (Amendment) Regulations 2016 (S.I. 2016/742), reg. 1(2), Sch. 1 para. 56

Reducing capacity payments: unpaid capacity provider penalty charges E+W+S

49.—(1) This regulation applies if, at the time when a credit note is issued to a capacity provider (“C”) for a capacity payment, C is in default in respect of a capacity provider penalty charge (an “unpaid penalty charge”).

(2) If this regulation applies—

(a) the Settlement Body must ensure that the credit otherwise payable to C is reduced—

(i) by the amount of the unpaid penalty charge;

(ii) to nil, if the amount of the unpaid penalty charge is equal to or greater than the amount of the credit; and

(b) the amount by which the credit is reduced is to be treated as a payment or part payment of the unpaid penalty charge.

(3) The Settlement Body must ensure that the credit note issued to C states the amount by which the credit is reduced, and the reason for the reduction.

[F11 Reducing capacity payments: offsetting relevant expenditure E+W+S

49A.— [F12 (1) This paragraph applies if, before the time when a credit note is issued to a capacity provider (“C”) for a capacity payment, the Delivery Body has acknowledged receipt of a declaration under the Rules that—

(a) relevant expenditure has been incurred, or is expected to be incurred; or

(b) relevant benefit has been received, or is expected to be received,

in respect of the capacity committed CMU for which C is responsible (“CMU i”).]

(2) If [F13 paragraph (1)] applies, the Settlement Body must ensure that the credit otherwise payable to C is reduced—

(a) by the [F14 aggregate] amount of any outstanding relevant expenditure [F15 and outstanding relevant benefit]; or

(b) to nil, if the [F16 aggregate] amount of any outstanding relevant expenditure [F17 and outstanding relevant benefit] is equal to or greater than the amount of the credit.

(3) The Settlement Body must ensure that the credit note issued to C states the amount by which the credit is reduced, and the reason for the reduction.

[F18 (3A) This paragraph applies where—

(a) the aggregate amount of any outstanding relevant expenditure and outstanding relevant benefit (“aggregate outstanding amount”) in respect of CMU i is greater than nil; and

(b) there are no further capacity payments in respect of CMU i which the Settlement Body would be required to reduce under paragraph (2) to offset this aggregate outstanding amount.

(3B) Where paragraph (3A) applies—

(a) C is liable to pay to the Settlement Body an amount equal to the lesser of—

(i) the aggregate outstanding amount; or

(ii) the total amount of all the capacity payments paid to C in respect of CMU i, less the amount of any repayment of these capacity payments by C to the Settlement Body under regulation 43B, 43C or 50; and

(b) the Settlement Body must, as soon as reasonably practicable after paragraph (3A) becomes applicable, issue to C an invoice for the amount C is liable to pay under sub-paragraph (a).]

[F19 (4) This regulation applies to a credit note or invoice issued in respect of a transferred part as it applies to a credit note or invoice issued in respect of a capacity agreement, and where a capacity agreement has been transferred pursuant to regulation 30A(1)(b) or (2)(b)—

(a) the reduction in the amount payable to C pursuant to paragraph (2) is to be calculated so that it is proportionate to the period and part of the capacity obligation held by C during the month to which the credit note relates; and

(b) the aggregate outstanding amount attributable to C under paragraph (3B)(a) is to be determined by adjusting this amount so that it is proportionate to the period and part of the capacity obligation held by C throughout the duration of the capacity agreement.]

(5) In this regulation—

[F20 “outstanding relevant benefit” means relevant benefit that has not been deducted from capacity payments pursuant to this regulation;]

“outstanding relevant expenditure” means relevant expenditure that has not been deducted from capacity payments pursuant to this regulation; and

[F21 “relevant benefit” has the meaning given in the Rules.]

“relevant expenditure” has the meaning given in the Rules.]

Textual Amendments

F11 Reg. 49A inserted (2.11.2017) by The Electricity Capacity (Amendment) Regulations 2017 (S.I. 2017/1053), reg. 1(2), Sch. 1 para. 5

F12 Reg. 49A(1) substituted (18.7.2019) by The Electricity Capacity (No. 2) Regulations 2019 (S.I. 2019/1139), regs. 1(2), 2(8)(a)

F13 Words in reg. 49A(2) substituted (18.7.2019) by The Electricity Capacity (No. 2) Regulations 2019 (S.I. 2019/1139), regs. 1(2), 2(8)(b)(i)

F14 Word in reg. 49A(2)(a) inserted (18.7.2019) by The Electricity Capacity (No. 2) Regulations 2019 (S.I. 2019/1139), regs. 1(2), 2(8)(b)(ii)(aa)

F15 Words in reg. 49A(2)(a) inserted (18.7.2019) by The Electricity Capacity (No. 2) Regulations 2019 (S.I. 2019/1139), regs. 1(2), 2(8)(b)(ii)(bb)

F16 Word in reg. 49A(2)(b) inserted (18.7.2019) by The Electricity Capacity (No. 2) Regulations 2019 (S.I. 2019/1139), regs. 1(2), 2(8)(b)(iii)(aa)

F17 Words in reg. 49A(2)(b) inserted (18.7.2019) by The Electricity Capacity (No. 2) Regulations 2019 (S.I. 2019/1139), regs. 1(2), 2(8)(b)(iii)(bb)

F18 Reg. 49A(3A)(3B) inserted (18.7.2019) by The Electricity Capacity (No. 2) Regulations 2019 (S.I. 2019/1139), regs. 1(2), 2(8)(c)

F19 Reg. 49A(4) substituted (18.7.2019) by The Electricity Capacity (No. 2) Regulations 2019 (S.I. 2019/1139), regs. 1(2), 2(8)(d)

F20 Words in reg. 49A(5) inserted (18.7.2019) by The Electricity Capacity (No. 2) Regulations 2019 (S.I. 2019/1139), regs. 1(2), 2(8)(e)(i)

F21 Words in reg. 49A(5) inserted (18.7.2019) by The Electricity Capacity (No. 2) Regulations 2019 (S.I. 2019/1139), regs. 1(2), 2(8)(e)(ii)

Reducing capacity payments: failure to demonstrate satisfactory performance E+W+S

50.—(1) This regulation applies in relation to a capacity committed CMU (“CMU i”) and a delivery year (“year X”) if—

(a) a satisfactory performance requirement applies in respect of CMU i in year X; and

(b) the requirement has not been met by 30th April in year X.

(2) If, by the end of a relevant month, the capacity provider in respect of CMU i (“C”) has not complied with the satisfactory performance requirement, no monthly capacity payment is to be paid in respect of CMU i for that month.

[F22 (2A) If C complies with the satisfactory performance requirement during May in year X, no monthly capacity payment is to be paid in respect of CMU i for that month.]

(3) If C complies with the satisfactory performance requirement during a relevant month [F23 other than May], the Settlement Body must ensure that the credit which would otherwise be payable to C in respect of the monthly capacity payment for CMU i for that month is reduced by the proportion , where—

(a) A is the number of days in the relevant month before the day on which C complies with the satisfactory performance requirement; and

(b) B is the number of days in the relevant month.

(4) If C has not complied with the satisfactory performance requirement by the end of year X—

(a) C must repay to the Settlement Body all capacity payments made in respect of CMU i and year X [F24 less the total amount of any capacity provider penalty charges that C has paid in respect of CMU i and year X]; and

(b) the Settlement Body must, as soon as reasonably practicable after the end of year X, issue an invoice to C for the amount [F25 due under sub-paragraph (a)].

(5) The Settlement Body must—

(a) if paragraph (2) [F26 or paragraph (2A)] applies, give a notice to C which states that no monthly capacity payment is to be paid in respect of CMU i for the relevant month, and states the reason;

(b) if paragraph (3) applies, ensure that the credit note issued to C for the relevant month states the amount by which the credit is reduced, and states the reason;

(c) if paragraph (4) applies, ensure that the invoice issued to C under paragraph (4)(b) states the reason for the issue of the invoice.

(6) In this regulation—

“relevant month” means May, June, July, August or September in year X;

“satisfactory performance day” has the meaning given in the Rules;

“satisfactory performance requirement” means a requirement in capacity market rules for a capacity provider to demonstrate satisfactory performance days in respect of a capacity committed CMU.

Textual Amendments

F22 Reg. 50(2A) inserted (24.3.2015) by The Electricity Capacity (Amendment) Regulations 2015 (S.I. 2015/875), reg. 1(2), Sch. 1 para. 17(a)

F23 Words in reg. 50(3) inserted (24.3.2015) by The Electricity Capacity (Amendment) Regulations 2015 (S.I. 2015/875), reg. 1(2), Sch. 1 para. 17(b)

F24 Words in reg. 50(4)(a) inserted (14.7.2016) by The Electricity Capacity (Amendment) Regulations 2016 (S.I. 2016/742), reg. 1(2), Sch. 1 para. 57(a)

F25 Words in reg. 50(4)(b) substituted (14.7.2016) by The Electricity Capacity (Amendment) Regulations 2016 (S.I. 2016/742), reg. 1(2), Sch. 1 para. 57(b)

F26 Words in reg. 50(5)(a) inserted (24.3.2015) by The Electricity Capacity (Amendment) Regulations 2015 (S.I. 2015/875), reg. 1(2), Sch. 1 para. 17(c)

Modifications etc. (not altering text)

C1 Reg. 50 modified (4.7.2020) by The Electricity Capacity (Amendment etc.) (Coronavirus) Regulations 2020 (S.I. 2020/697), reg. 1(2), Sch. 2 para. 3

Withholding credit payments to capacity providers E+W+S

51.—(1) This regulation applies where, at the time when a credit note is issued to a capacity provider (“C”) under this Part—

(a) C is subject to a data default notice; or

(b) the Settlement Body is aware that C is insolvent.

(2) The Settlement Body must ensure that—

(a) the credit is withheld; and

(b) the credit note states that the payment is to be withheld and states the reason why.

(3) In this regulation, “data default notice” has the meaning given by regulation 37(1).

Payment of withheld credit E+W+S

52.—(1) Paragraphs (2) and (3) apply where a credit is withheld from a capacity provider (“C”) under regulation 51.

(2) If, where the credit is withheld for the reason in regulation 51(1)(b), an invoice is due to be issued to C, the Settlement Body may deduct all or part of the withheld credit from the amount invoiced, and the amount so deducted is to be treated as having been paid to C.

(3) Except where the withheld credit has been deducted from an invoice in accordance with paragraph (2), the Settlement Body must pay the withheld credit on the next occasion which the Settlement Body considers practicable when—

(a) credit payments are made under this Part; and

(b) the Settlement Body is not required to withhold a credit from C under regulation 51.