Ofgem has published its tenth annual report on the operation of the Capacity Market, covering the period from 1 October 2024 to 30 September 2025. The report reviews outcomes from two scheduled auctions: the 2024/25 T-1 Auction for delivery year 2025/26 and the 2024/25 T-4 Auction for delivery year 2028/29. It includes analysis of prequalification processes, bidding behaviour, delivery milestones and delivery year performance.

Ofgem publishes response on changes to RIIO-ED2 expenditure volume drivers and confirms licence modificationsMini-Summary: Ofgem has published its response to its consultation on proposed modifications to the RIIO-ED2 Load Related Expenditure (LRE) volume drivers, confirming that it will amend Special Condition 3.9 of the electricity distribution licence. The modifications will increase the Low Voltage Services Volume Driver (LVSVD) unit rates and ex ante allowances for all distribution network operators (DNOs), as well as the Secondary Reinforcement Volume Driver (SRVD) ex ante allowance for SP Electricity North West. Ofgem has also made targeted drafting clarifications while maintaining the substantive policy position set out in its June 2026 decision. The modifications will apply during years 4 and 5 of RIIO-ED2 and take effect on 6 November 2026.

Ofgem has published its response to the consultation on the proposed changes to the licence fee cost recovery principles (LFCRP). Ofgem has confirmed that, having considered the responses to the consultation, it will proceed with the proposed amendments. These amendments intend to allow for Ofgem to recover costs relating to the set up and operation of a regulatory framework for heat networks.

Ofgem has published the response to its November 2024 consultation on heat networks authorisation and regulatory oversight. Ofgem confirmed it will proceed with its proposed approach regarding multiple operator heat networks, registration and authorisation application processes, the management of changes to authorised heat networks and its overall regulatory oversight approach.

Ofgem has published its response to its consultation on changes to the Supplier Guaranteed Standard of Performance (GSoP) 6ZA. Ofgem had proposed a reduction to the time suppliers must switch a customer’s electricity or gas supply before having to pay customers a £30 compensation fee, from 15 working days to five. This would align the Supplier GSoP with the energy supplier’s licence which also stipulates five working days. As a result of the consultation, Ofgem has decided to go forward with the proposed change which will take effect from 1 April 2024. The change will only affect households or people who run their business from home and are on a domestic energy tariff.

Ofgem has published a statement, detailing the findings of its investigation into Drax Power Limited’s compliance with reporting requirements under the Renewables Obligation (RO) scheme. The investigation found that Drax misreported its annual profiling data for 2021-22 due to inadequate data governance and controls, resulting in a £25m payment to Ofgem’s Voluntary Redress Fund. Drax has agreed to conduct an independent audit of its profiling data, covering 98% of its global supply chain for 2023-24. Ofgem also reviewed KPMG reports prepared for Drax and found no evidence of sustainability obligation breaches that would affect RO funding eligibility. The statement further clarifies the application of sustainability criteria and reporting requirements under the RO scheme.

Ofgem has published interim regulatory reporting pack (RRP) revenue sheets and associated guidance to assist gas transmission network operators reporting within the Price Control Finance Models (PCFM) for the 2026 Annual Iteration Process (AIP). The 2026 AIP is part of the RIIO-3 price control framework, which covers electricity transmission and distribution in addition to gas transmission as covered by this guidance. In addition to providing template revenue sheets to make the process of populating relevant data easier, Ofgem's guidance covers instructions and recommendations on how to populate these values, how to report and submit data within the process and timeframe necessary for RIIO-3, and associated information, documentation and commentary submission requirements.

Ofgem has published its ten-year review of the Capacity Market (CM) Rules, as required by Regulation 82 of the Electricity Capacity Regulations 2014 and Rule 15.2 of the Capacity Market Rules 2014. This review, which follows the 2019 five-year review, incorporates stakeholder feedback from a January 2024 consultation on proposed amendments. While Ofgem concluded that the Rules are effective in incentivising investment in secure electricity generation, it accepted stakeholder recommendations to review and simplify them. In addition, it identified specific Rules requiring further investigation, including the prequalification process, secondary trading, scheme interactions, the role of interconnectors, and the alignment of CM auctions with different revenue streams, aiming to evaluate potential improvements.

Ofgem has published the total number of Renewables Obligation Certificates (ROCs) that must be presented to it for the 2023–2024 period. Suppliers can request a buy–out payment by 31 August 2024 or meet their obligations in full by 1 September 2024. Suppliers who do not meet their obligations by the September deadline, will need to make late payments by 31 October 2024.

Ofgem has published two decisions relating to Balancing Services Use of Systems (BSUoS) charges. It has firstly approved the Connection and Use of Systems Code (CUSC) modification proposal 308 (CMP308), which changes the way BSUoS charges are collected from electricity network users. The charging of BSUoS will be moved from generation and demand to Final Demand only from 1 April 2023 onwards. It has also approved Balancing and Settlement Code (BSC) P419 which enables the aggregation and submission of the metered demand data of Non-Final Demand Facilities, such as electricity generation facilities, energy storage and eligible service facilities, to be exempt from BSUoS charges.

Ofgem has published two determinations in respect of Tier 2 Contracts for Difference (CfD) Allocation Round 4 (AR4) disputes relating to an appeal made by Carn Nicholas Solar Ltd and Moss Lane Farm Solar Ltd. Ofgem has found that in relation to Carn Nicholas Solar Ltd, the Electricity Market Reform (EMR) Delivery Body did not reach the correct decision when it rejected the company for CfD AR4 as, according to Ofgem, the applicant has provided sufficient information to demonstrate that it is VAT registered and has provided a copy of its VAT group certificate. As such, Ofgem overturned the EMR Delivery Body's non-qualification determination and instead determined Carn Nicholas Solar Ltd as a qualifying applicant. Regarding Moss Lane Farm Solar Ltd, Ofgem also overturned the EMR Delivery Body's non-qualification determination, because it maintained that all the relevant information required in the CfD application was provided by the applicant to undertake the checks in Schedule 5 of the Allocation Framework and make a determination. Thus, Moss Lane Farm Solar Ltd was determined to be a qualifying applicant also.

Ofgem has published two guidance documents on compliance with the Renewables Obligation (RO) scheme. The first document provides guidance for operators of generating stations that utilise solid biomass, biogas, or bioliquids on how to comply with the sustainability requirements under the RO scheme. The second document provides guidance for licensed electricity suppliers in Great Britain and Northern Ireland, outlining the necessary steps for compliance with the RO scheme.