Skip to main content

Clifford Chance

Clifford Chance


Capacity Market: an EMR Primer

30 November 2015

This primer briefing is the second in a series of briefings describing the principal mechanisms introduced as part of the UK Government's Electricity Market Reforms (EMR), namely:

  • Contracts for Difference;
  • Capacity Market Mechanism;
  • Carbon Price Floor; and
  • Emissions Performance Standard.

The EMR reforms have three key aims: to bolster the security of electricity supplies, encourage the decarbonisation of the power sector and keep energy affordable. This primer explains how the Capacity Market works and covers:

  • Eligibility for the mechanism;
  • The Pre-qualification and auction processes;
  • The form and content of Capacity Agreements including key milestones and termination provisions;
  • The delivery of capacity obligations, payments, penalties and trading; and
  • Implementation of the Capacity Market to-date. 
Download PDF