Great Britain — Reformed National Market

A national wholesale market supported by balancing, constraint management, capacity procurement, Contracts for Difference, ancillary services, network charging and local flexibility mechanisms.

Solution section

Investment & Cost Recovery

How fixed costs, investment and resource adequacy are supported.

Investment & Cost Recovery

Fixed and investment costs can be recovered through several revenue streams:

Revenue = R_{energy} + R_{balancing} + R_{ancillary} + R_{capacity} + R_{contracts} + R_{other}.

For many low-carbon generators, Contracts for Difference provide long-term revenue stabilisation.

The Capacity Market provides a separate adequacy payment.

Network companies recover regulated revenues through charging frameworks.

The architecture therefore explicitly accepts that short-run marginal energy prices alone may not provide the complete investment signal required by the system.