Have your say on electricity market reforms

The National Energy System Operator (NESO) has published a call for input from industry on proposed reforms to the electricity market, helping ensure it keeps pace with the way the system is quickly changing, while reducing costs to consumers.

The electricity network has transformed over the last decade, making tremendous progress towards decarbonisation. 44% of our power now comes from renewables like wind and solar - a threefold increase since 2015. 

Britain’s network is no longer made up of a handful of large thermal generation assets with relatively predictable demand, but instead many smaller and weather-dependent ones, storage units that are more responsive and flexible, and with much greater interconnection with our European neighbours thanks to underwater cables. 

As the system evolves, NESO now needs to intervene much more to make sure supply and demand is always balanced, ensuring households and businesses across the country have the electricity they need when they need it. 

The Government concluded its Review of Electricity Market Arrangements (REMA) last year, announcing a new programme of reform under Reformed National Pricing (RNP), which NESO is a key partner in delivering. This package of reforms aim to help more efficiently locate new generation assets, reduce the impact of constraints and drive more efficient operation of our power system. 

These changes represent an historic opportunity to modernise Britain’s electricity market, improving data quality, providing the market with clearer signals and incentives, and making better use of our diverse and flexible generation and storage assets. 

The formal call for input outlines a proposed package of balancing reforms, which aim to improve operational efficiency, reduce rising balancing costs, and support the delivery of Clean Power by 2030. The include: 

• lowering the mandatory Balancing Mechanism participation threshold;
• aligning the market trading deadline with gate closure;
• ensuring final physical notifications match participants’ traded position;
• requiring market participants to provide unit-level bids and offers at day ahead; and
• introducing shorter settlement periods of 5 or 15 minutes rather than 30 minutes. 

Rebecca Beresford, Director of Markets said: 

“Our electricity system is changing fast, and we need to ensure the mechanisms for balancing what is generated and stored with what is consumed, remains fit for purpose. 

“These proposed reforms are about ensuring we have a modern energy market that works at its best for those operating in it and for those using it every day to power their homes and businesses. 

“This is our chance to drive meaningful and positive changes, to help ensure we can operate the system better and more affordably for Britain’s consumers. 

“We want to hear your views to help us develop market arrangements that promote competition, optimise system operations and encourage investment, while always ensuring consumers get the best deal possible.” 

Further detail on the reforms is available here, and those who wish to contribute are encouraged to do so by 14 April 2026.