delete The Electricity Capacity (Amendment) Regulations 2025
The Electricity Capacity (Amendment) Regulations 2025 amend the Electricity Capacity Regulations 2014 to: (1) introduce a new 9-year minimum £/kW capital expenditure threshold for capacity market commitments alongside existing 3-year and 15-year thresholds; (2) add definitions for 'low emissions determination', 'declared low carbon CMU', 'new build CMU', 'refurbishing CMU', 'three year zero capex threshold CMU', and 'extended performance'; (3) modify prequalification rules relating to Contracts for Difference (CFD); (4) change regulation 39(4) from '20' to '34'; (5) revise satisfactory performance requirements; and (6) establish appeal procedures for low emissions determinations.
These regulations add layers of complexity to an already heavily regulated capacity market regime. The new 9-year commitment tier introduces additional government discretion over which investments qualify, creating further market distortion. The 'low emissions determination' concept allows officials to pick winners based on emissions criteria rather than allowing market forces to determine generation mix. Capital expenditure thresholds per kW are arbitrary government mandates that distort investment decisions. The capacity market itself is a form of central planning that guarantees revenue to certain generators, suppressing competition from more efficient or innovative alternatives. These amendments increase rather than decrease the regulatory burden, adding compliance costs and limiting private sector flexibility in a sector better served by deregulation and competitive wholesale markets.