Electricity Market Reform

ELECT R ICITY MARKET R EFORM

Electricity Market Reform

EMR Settlement Ltd (EMRS), Elexon’s wholly owned subsidiary, is the Settlement Services Provider to the Low Carbon Contracts Company (LCCC) and the Electricity Settlements Company (ESC). EMRS calculates, collects and distributes payments for both the Capacity Market (CM) and Contracts for Difference (CfD) schemes.

The separation between Elexon and EMRS ensures risks and liabilities from EMR Settlement activities cannot affect Elexon. While some of our people work full-time on EMR activity, other industry experts from Elexon support EMR Settlement activities part-time, but regardless, all record their time to ensure their cost is allocated appropriately to BSC or EMR activities. This also enables us to allocate a proportionate share of the Elexon overheads such as office costs etc. Nearly £5.6m of such overheads have been borne by EMRS since 2015, meaning that without the EMR activities, BSC Parties would have had to bear an additional £5.6m over that period. EMRS will continue to provide these Settlement operations until the current contract expires in 2026. Given the similarities between EMR and Elexon key offerings, best practice is shared to further realise efficiencies and synergies for the benefit of both the EMR and Elexon customers.