Ofgem kills P212 (market-based settlement prices)
Ofgem decision (3 pages, PDF) to reject P212, the proposal to use pre-event bilateral market prices plus/minus a fixed percentage as the post-event charges for settlement of wholesale electricity in Great Britain.
Ofgem's reasons for rejecting this proposal seem to boil down to:
- A claim that “cash-out prices set 1 hour ex-ante may not reflect energy demand and supply in the relevant balancing period, or outturn imbalance volumes”.
- A “belief that P212 might incentivise parties to manage their imbalance exposure through trying to influence the [bilateral market price] rather than attempting to balance their own positions”.
- The opposition of most of the industry to this proposal from a smaller independent supplier.
Ofgem ran its own consultation in December 2007.
For further information or advice please contact Franck Latrémolière.
Filed under BETTA, Electricity, Ofgem.
