Panel meets to discuss CM Supplier Interim Charge
The BSC Panel met on 21 December 2018 to discuss a new Modification, P378, which aims to introduce a CM Supplier Interim Charge for Suppliers with effect from 1 January 2019.
P378 was raised by VPI Immingham on 20 December 2018.
The Initial Written Assessment for P378 was presented to the Panel on 21 December 2018.
Purpose of the Modification
P378 proposes to use the BSC to introduce a CM Supplier Interim Charge for Suppliers with effect from 1 January 2019.
Its purpose is to act as a contingency fund to protect the industry, and customers, from a price shock in the event that the CM standstill is lifted and back-payments are required to be made.
Having this fund available will give confidence to industry and investors that they are able to continue normal operations during this standstill period.
Background to Modification
On 15 November 2018 the General Court of the Court of Justice of the European Union found in favour of Tempus Energy, against the European Commission (EC), annulling the Commission’s State aid approval for the GB Capacity Market (CM). All CM cost recovery by Suppliers and payments to capacity providers have been suspended with all credit cover available to be returned.
The UK Government maintains that the CM is the most cost effective way of ensuring security of supplies and is working with the EC to reinstate the CM.