Power purchase agreements and routes to market

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This is an overview of the key content to be found in our Power purchase agreements and routes to market subtopic. It briefly explains the nature of this content and provides links to it.

  1. •

    Practice Note: Drafting take-or-pay clauses in energy contracts—introduces the common features of take-or-pay clauses in energy contracts and provides some example clauses. It also considers the distinction between take-or-pay clauses and take-and-pay clauses

  2. •

    Practice Note: An introduction to EU law and competition law issues for take-or-pay clauses in energy contracts—introduces take-or-pay clauses in the energy sector and considers some of the EU, regulatory and competition law issues regularly encountered when considering take-or-pay clauses in the energy contracts

  3. •

    Practice Note: Take-or-pay clauses in energy contracts: the rule on penalties—introduces English Court’s attitude to take-or-pay clauses and a thorough consideration of take-or-pay clauses and the rule on penalties

  4. •

    Practice

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Latest Energy News

Ofgem publishes open letter highlighting coordination challenges in energy sector digitalisation governance

Ofgem has published an open letter outlining the urgent need for architectural coordination in the digitalisation of the UK's energy system. Drawing on the Clean Flexibility Roadmap and the Sector Digitalisation Plan, the letter sets out five key questions that must be resolved to achieve effective coordination and ensure that digitalisation efforts are coherent and cost-effective. Notably, Ofgem highlights a significant governance gap, noting the absence of a neutral body or group capable of overseeing architectural coordination across all delivery bodies. Ofgem invites stakeholder feedback on these issues until 5 December 2025, including participation in related workshops.

Ofgem sets out strategic direction for flexibility digital infrastructure

Ofgem has published a letter setting out its policy positions on the need for common digital infrastructure across the National Energy System Operator (NESO) and Distribution System Operator (DSO) flexibility markets. The letter addresses support for small-scale flexible asset participation in flexibility markets, considering where common digital infrastructure may be required across flexibility market processes. Ofgem previously decided that Flexibility Market Asset Registration should be delivered as common digital infrastructure by Elexon, acting as the Market Facilitator. It is now considering whether other steps in the flexibility market process should also be supported by common digital infrastructure. The open letter provides Ofgem's current policy position for each step of the process and outlines its forward monitoring approach. Stakeholders are invited to submit informal feedback on the policy positions by 2 December 2025.

Ofgem consults on future of gas transporter traditional metering obligations post-2025

Ofgem has launched a consultation on proposals for the future of regulated traditional gas metering obligations following the expiry of the current licence conditions on 31 December 2025. Ofgem’s preferred approach is to transition to a voluntary market arrangement from 1 January 2026 to 31 December 2026, allowing Gas Distribution Networks and National Gas Transmission to deliver services commercially while maintaining key consumer protections. The consultation covers proposed licence changes and the removal of sunset obligations, alongside new service standards and pricing principles under Ofgem’s proposed post-2025 voluntary agreements. The consultation runs until 1 December 2025.

DESNZ consults on removing CMU location changes after Capacity Market prequalification

The Department for Energy Security and Net Zero (DESNZ) has launched a consultation proposing to remove the ability for Capacity Market Units (CMUs) to change their location after prequalification. The proposed rule change would apply to both New Build CMUs and Demand Side Response (DSR) units, covering all existing and new agreements from winter 2025, and would prevent any location changes for Generating Units or DSR CMU Components. DESNZ states that the reform aims to strengthen delivery assurance by ensuring that applicant CMUs represent genuine New Build CMUs capable of contributing to Great Britain’s security of supply. The proposal also seeks to better reflect the CM’s original intent that projects should remain viable at the point of prequalification. The consultation closes on 14 November 2025.

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