Capacity Market (Amendment) Rules 2017

256 Pages·2017·1.97 MB·English

The Capacity Market (Amendment) Rules 2017

These Rules are made by the Gas and Electricity Markets Authority pursuant to the power
conferred by regulation 77 of the Electricity Capacity Regulations 2014 (S.I 2014/2043).
Presented to Parliament pursuant to section 41(9) of the Energy Act 2013 (c 32).
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The Capacity Market (Amendment) Rules 2017

These Rules are made by the Gas and Electricity Markets Authority pursuant to the power
conferred by regulation 77 of the Electricity Capacity Regulations 2014 (S.I 2014/2043).
Presented to Parliament pursuant to section 41(9) of the Energy Act 2013 (c 32).

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The Capacity Market (Amendment) Rules 2017

These Rules are made by the Gas and Electricity Markets Authority pursuant to the power
conferred by regulation 77 of the Electricity Capacity Regulations 2014 (S.I 2014/2043).
Presented to Parliament pursuant to section 41(9) of the Energy Act 2013 (c 32).

1. Citation and commencement
1.1. These Rules may be cited as the Capacity Market (Amendment) Rules 2017
1.2. These Rules come into force on 14 July 2017 .
2. Amendments
2.1. The Capacity Market Rules 20141 are amended as set out in the Schedule.

Mark Copley
13 July 2017 For and on behalf of The Authority

1 The Rules have previously been amended by the Capacity Market (Amendment) Rules 2014, the Capacity Market (Amendment)
(No.2) Rules 2014, the Capacity Market (Amendment) Rules 2015, and the Capacity Market (Amendment) (No.2) Rules 2015.
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SCHEDULE
AMENDMENTS TO THE CAPACITY MARKET RULES 2014
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Table of Contents
Contents Page
CHAPTER 1: GENERAL PROVISIONS ................................................................................................. 1
1.1 Citation and commencement ..................................................................................................... 1
1.2 Definitions ................................................................................................................................... 1
1.3 Interpretation ............................................................................................................................. 38
1.3A Sole director companies .......................................................................................................... 38
1.4 Times and dates ........................................................................................................................ 39
1.5 Hierarchy of documents ........................................................................................................... 39
1.6 Notices ....................................................................................................................................... 39
1.7 Waiver ........................................................................................................................................ 39
1.8 Assignment ............................................................................................................................... 40
1.9 Language ................................................................................................................................... 40
CHAPTER 2: AUCTION GUIDELINES AND DE-RATING .................................................................... 41
2.1 Purpose of this Chapter ........................................................................................................... 41
2.2 Capacity Auction Timetable and Guidelines .......................................................................... 41
2.3 De-rating of CMUs ..................................................................................................................... 42
CHAPTER 3: PREQUALIFICATION INFORMATION ........................................................................... 46
3.1 Purpose of this Chapter ........................................................................................................... 46
3.2 Identifying the Applicant for a CMU ........................................................................................ 46
3.3 Submitting an Application for Prequalification ..................................................................... 48
3.4 Information to be provided in all Applications ...................................................................... 50
3.5 Determining the Connection Capacity of a Generating CMU ............................................... 53
3.5A Determining the Connection Capacity of an Interconnector CMU ...................................... 56
3.5B Clarifications for determining the Connection Capacity of CMUs ...................................... 56
3.6 `Additional Information for an Existing Generating CMU ..................................................... 56
3.6A Additional information for an Existing Interconnector CMU ................................................ 59
3.6B Additional Information for an Existing or Prospective Interconnector CMU ...................... 60
3.6C Additional Information for a New Build Interconnector CMU............................................... 60
3.7 Additional Information for a New Build CMU ......................................................................... 61
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3.8 Additional Information for a Refurbishing CMU .................................................................... 64
3.9 Additional Information for a Proven DSR CMU ..................................................................... 65
3.10 Additional Information for an Unproven DSR CMU ............................................................... 67
3.10A Applications for a Supplementary Auction: Connection Arrangements ............................ 68
3.11 Opt-out Notifications ................................................................................................................ 69
3.12 Declaration to be made when submitting an Application ..................................................... 70
3.13 Application process for Secondary Trading Entrants .......................................................... 70
3.14 Retention of Applications and Opt-out Notifications by the Delivery Body ....................... 71
CHAPTER 4: DETERMINATION OF ELIGIBILITY ............................................................................... 72
4.1 Purpose of this Chapter ........................................................................................................... 72
4.2 Delivery Body to assess the completeness of an Application ............................................. 72
4.3 Delivery Body to review complete Applications .................................................................... 72
4.4 Decisions to be made by the Delivery Body .......................................................................... 73
4.5 Notification of Prequalification decision to Applicants ........................................................ 75
4.5A New Build Interconnector CMU and Unproven DSR CMU: Applicant Credit Cover .......... 76
4.5B New Build Interconnector CMU and Unproven DSR CMU: provision of Applicant Credit
Cover by Capacity Provider ..................................................................................................... 77
4.5C Applicant Credit Cover: notices to Delivery Body ................................................................ 78
4.6 Conditional Prequalification – Applicant Credit Cover ......................................................... 78
4.7 Conditional Prequalification – Planning Consents ............................................................... 79
4.8 Provision of a Price-Maker Memorandum and Certificate by Applicants ........................... 79
4.9 Notification of Prequalification decision to Secondary Trading Entrants .......................... 80
4.10 Disputes relating to Prequalification ...................................................................................... 80
4.11 Changes to the Auction Parameters ....................................................................................... 80
CHAPTER 5: CAPACITY AUCTIONS ................................................................................................... 82
5.1 Purpose of this Chapter ........................................................................................................... 82
5.2 The role of the Auctioneer ....................................................................................................... 82
5.3 Qualification to bid in the Capacity Auction .......................................................................... 82
5.4 Disqualification from future bid submission ......................................................................... 82
5.5 Capacity Auction format .......................................................................................................... 83
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5.6 Duration Bids in a Capacity Auction ....................................................................................... 85
5.7 Continuing Bids in a Capacity Auction .................................................................................. 86
5.8 Exit Bids in a Capacity Auction ............................................................................................... 87
5.9 Capacity Auction clearing ........................................................................................................ 87
5.10 Capacity Auction results .......................................................................................................... 90
5.11 Capacity Auction suspension or cancellation ....................................................................... 91
5.12 Prohibition on Market Manipulation ........................................................................................ 92
5.13 Prohibition on other unreasonable business methods ........................................................ 92
5.14 Auction Monitor and Audit of Capacity Auctions .................................................................. 93
CHAPTER 6: CAPACITY AGREEMENTS ............................................................................................ 95
6.1 Purpose of this Chapter ........................................................................................................... 95
6.2 Nature of Capacity Agreement Notices and Capacity Agreements ..................................... 95
6.3 Issuing Capacity Agreement Notices ..................................................................................... 95
6.4 Indexation .................................................................................................................................. 97
6.5 Survival ...................................................................................................................................... 97
6.6 Achieving the Financial Commitment Milestone ................................................................... 97
6.6A Achieving the Financial Commitment Milestone: New Build CMUs .................................... 99
6.7 Achieving the Substantial Completion Milestone ................................................................. 99
6.8 Sanctions for Delay in Achieving Milestones ...................................................................... 101
6.9 Exclusion of Force Majeure ................................................................................................... 103
6.10 Termination .............................................................................................................................. 103
6.11 Non-completion Fee ............................................................................................................... 111
CHAPTER 7: CAPACITY MARKET REGISTER ................................................................................. 113
7.1 Purpose of this Chapter ......................................................................................................... 113
7.2 Establishment, form and maintenance of the Capacity Market Register .......................... 113
7.3 Effect of registration determinative ...................................................................................... 113
7.4 Contents of the Capacity Market Register ........................................................................... 113
7.5 Delivery Body amendments to the Capacity Market Register ........................................... 117
7.6 Capacity Market Register to be publicly available .............................................................. 120
7.7 Applications for rectification of the Capacity Market Register and Appeals ................... 120
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7.8 Replacement Capacity Agreement Notice ............................................................................ 121
CHAPTER 8: OBLIGATIONS OF CAPACITY PROVIDERS AND SYSTEM STRESS EVENTS ....... 122
8.1 Purpose of this Chapter ......................................................................................................... 122
8.2 General obligation to maintain eligibility ............................................................................. 122
8.3 Specific obligations and consequences .............................................................................. 122
8.4 Triggering a Capacity Obligation and System Stress Events ............................................ 131
8.5 Discharging a Capacity Obligation ....................................................................................... 134
8.6 Determining the output of a Capacity Committed CMU or CMVR Registered CMU (Eij) 138
8.7 Requirement to provide general assistance ........................................................................ 139
CHAPTER 9: TRANSFER OF CAPACITY OBLIGATIONS ................................................................ 140
9.1 Purpose of this Chapter ......................................................................................................... 140
9.2 Restrictions on transfer and eligibility to trade ................................................................... 140
9.3 Registration of transfers ........................................................................................................ 145
9.4 Effect of transfer ..................................................................................................................... 145
9.5 Transfers and testing.............................................................................................................. 146
CHAPTER 10: VOLUME REALLOCATION ........................................................................................ 147
10.1 Purpose of this Chapter and Interpretation ......................................................................... 147
10.1A CMVR Registered Participant ................................................................................................ 147
10.2 Capacity Market Volume Reallocation Notification ............................................................. 148
10.3 Matching .................................................................................................................................. 149
10.4 Traded Capacity Market Volume ............................................................................................ 149
10.5 Information .............................................................................................................................. 150
10.6 Failures of the CM Settlement Body System ....................................................................... 151
CHAPTER 11: TRANSITIONAL ARRANGEMENTS ........................................................................... 152
11.1 Purpose of this Chapter ......................................................................................................... 152
11.2 Application of the Rules to transitional arrangements ....................................................... 152
11.3 Transitional Capacity Auctions ............................................................................................. 152
(a) the following CMUs must also be prohibited (and an Applicant must not submit an
Application for the Second Transitional Capacity Auction in relation to any such CMU):
.................................................................................................................................................. 153
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CHAPTER 12: MONITORING ............................................................................................................. 157
12.1 Purposes of this Chapter ....................................................................................................... 157
12.2 Monitoring of construction progress of Prospective CMUs .............................................. 157
12.3 Monitoring of Capacity Providers ......................................................................................... 158
12.4 Further monitoring obligations ............................................................................................. 159
12.5 Provision of information for monitoring purposes ............................................................. 159
CHAPTER 13: TESTING REGIME ..................................................................................................... 160
13.1 Purpose of this Chapter ......................................................................................................... 160
13.2 DSR Test .................................................................................................................................. 160
13.2A New DSR Test .......................................................................................................................... 163
13.2B Joint DSR Test ......................................................................................................................... 164
13.2C New Joint DSR Test ................................................................................................................ 168
13.3 Metering Test ........................................................................................................................... 170
13.4 Demonstrating satisfactory performance ............................................................................ 172
13.5 Site Audit ................................................................................................................................. 173
CHAPTER 13A: METERING RECOVERY FAULTS AND REPAYMENT OF CAPACITY PAYMENTS
.................................................................................................................................................. 177
13A.1 Purpose of this Chapter ......................................................................................................... 177
13A.2 Failure to notify a change to the metering configuration ................................................... 177
13A.3 Errors with the submission of data ....................................................................................... 179
13A.4 Faulty Metering Equipment .................................................................................................... 181
13A.5 Submission of incorrect information .................................................................................... 183
13A.6 Metering concerns following Site Audit ............................................................................... 185
13A.7 Determining the repayment periods ..................................................................................... 185
13A.8 Repayment of capacity payments for a metering fault ....................................................... 185
CHAPTER 14: DATA PROVISION ...................................................................................................... 187
14.1 Purpose of this Chapter ......................................................................................................... 187
14.2 General ..................................................................................................................................... 187
14.3 BSCCo: Data provision .......................................................................................................... 187
14.4 System Operator and Delivery Body: Data provision ......................................................... 188
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