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Electricity Market Reform charges starting to appear

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1st April sees the new reconciliation period for many charges within the energy industry and the new Electricity Market Reform charges introduced back in 2015 are now able to be reconciled by the suppliers in relation to what they have paid out. Some charges appeared on the bill from the start and customers have been paying on account until the reconciliation was possible, however some charges such as the Capacity Market Obligation Levy (costs to cover payments to capacity market generators) were not introduced until November 2016 and the scale of the levy was unclear.


A number of suppliers have simplified the four categories of charges into two, CfD (contracts for difference) and CM (capacity market), however as always there are a number of variations from suppliers in terms of whether it is included in the unit rate, shown as a separate charge or billed as an estimate with a future reconciliation.


The range of charges based on contract start dates, contract lengths and capacity of usage for CM alone range from below 0.1 p/kwh to over 1.5 p/kwh. As we have been stating for some time now, this is only going to increase as we move along the 2021 forecast period so it is really important this is not ignored at the outset because it is going to become a significant part of your costs going forward.


For all Zenergi customers we will of course be validating your invoices, providing detail on any reconciliations charged and generally making sure that the charges are correct and in line with the governments legislation. Unfortunately as we mentioned in our post back in 2015, EMR is legislation passed by Parliament and affects all electricity consumers so there is nothing we can do other than approve payment for the charges levied. If you require any further information you can of course visit https://electricitysettlementscompany.uk for more information.