1.1 Revenue developments
In Q1 2018, the main issues that could affect your revenue are:
Progression of proposed Capacity Market Rules changes – Ofgem plans to take forward 38 of the 112 change proposals (plus four of its own) that were submitted last year. These include requiring an exit bid for an auction to clear, and allowing generators a free choice of periods for evidencing historical output
2021-2022 T-4 and 2018-19 T-1 Capacity Auctions – Two capacity auctions cleared in the last quarter, both at record low prices. For the T-1 auction this was £6.00/kWh, with 5.8GW procured, and for the T-4 auction this was £8.40/kW, with 50.4GW procured
P354 progresses to Ofgem for decision – The BSC Panel has recommended that Ofgem approve this modification, which would remove spill payments from non-Balancing Mechanism participants in balancing services, reducing the revenue available to these providers
Firm Frequency Response to be simplified – The rules for Firm Frequency Response will be simplified for the tender period ending on 1 May and onwards, partly to reduce the burden on National Grid. This includes moving to four-hourly Electricity Forward Allocation blocks, and long-term procurement based on quarters and seasons
1.2 Cost developments
In Q1 2018, the main issues that could affect your costs are:
Final TNUoS tariffs for 2018-19 – The final Transmission Network Use of System (TNUoS) tariffs for this year are almost identical to the drafts published in December, with only a few small changes. Demand tariffs have been set to recover £2.240.2mn. ...
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