The UK Government has been conducting an in-depth review of electricity market arrangements (REMA) since the summer of 2022. This report sets out an industry approach to REMA, proposing the next steps required to build a wholesale energy market aligned to the UK’s net zero targets and energy security ambitions. The report highlights the need to build a market that facilitates and rewards the energy transition which is already underway. This means enabling the deployment of more renewables across the country while combining with innovative energy storage and demand-side response technologies. Doing so requires a market that successfully balances variable low carbon supply and demand, while rewarding flexibility services and firm supply contracts. This report calls for these attributes to be appropriately incentivised and rewarded within the new wholesale market design. It calls for this to be done through an evolutionary approach, by adapting the existing market mechanism of the CfD and capacity market, rather than radically splitting the market, as also proposed by the Government’s REMA process.

This report was kindly prepared by Dr. Chris Harris (University of Bath) and edited by Mark Sommerfeld (REA) with input from the REA’s REMA Working Group

Click here to read the full report.

Slides from the REA REMA conference and Report Launch can be viewed here.