GB electricity generation and storage regulation

Introduction

This is an overview of the key content to be found in our GB electricity generation and storage regulation subtopic. It briefly explains the nature of this content and provides links to it. For details of our content providing a more general overview of how the GB energy market fits together, and its licensing regime, see the Overarching GB gas and electricity market regulation subtopic.

The Department for Energy Security and Net Zero (DESNZ) was established on 7 February 2023 and has taken over the energy portfolio, including in respect of electricity generation and storage regulation, of the former Department for Business, Energy and Strategy (BEIS), which no longer exists.

GB

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Latest Energy News

DESNZ announces 27 projects shortlisted for HAR2

The Department for Energy Security and Net Zero (DESNZ) has announced that 27 electrolytic hydrogen production projects across England, Scotland, and Wales have been shortlisted for the next stage of the Second Hydrogen Allocation Round (HAR2), which involves due diligence and a cost assessment. These projects aim to support the use of hydrogen in sectors, such as ammonia production, clean power generation, glass manufacturing, brick making, and sustainable aviation fuel production. Additionally, DESNZ has published a set of guidance and forms to assist shortlisted projects in the next stage, covering cost competitiveness, due diligence, and cost assurance. The projects must demonstrate measurable plans to achieve lower hydrogen production costs, ideally lower than those in HAR1, and successfully pass the due diligence stage to advance further in the allocation process.

Ofgem consults on amendments to MHHS Governance Framework

Ofgem has launched a consultation, seeking views on proposed amendments to the Market-Wide Half-Hourly Settlement (MHHS) Governance Framework. These changes aim to mitigate delays in the implementation of MHHS arrangements and rectify administrative errors. This consultation follows Ofgem’s approval of Change Request CR055 ‘Amendments to M10 and corresponding milestones’ in November 2024, which resulted in a 6.5-month delay to MHHS implementation. The consultation closes on 21 April 2025, with decisions expected in May 2025.

Court of Session rules on development of the Rosebank and Jackdaw oil/gas fields

Environment analysis: In a significant Judgement, the Court of Session (Edinburgh) declared consents granted for development of the Rosebank and Jackdaw oil/gas fields unlawful and ruled on remedy (relief). The next key stage in a series of environmental/public law cases examining legal obligations relating to fossil fuel extraction, this case continues the journey from the landmark UK Supreme Court decision in Finch.

Ofgem finalises regime parameters for Offshore Hybrid Asset pilot scheme

Ofgem has published a decision, outlining the further detailed regime parameters for the Offshore Hybrid Asset pilot scheme, following its September 2024 consultation. The scheme comprises two proposed non-standard interconnector (NSI) projects: LionLink and Nautilus, which will connect Great Britain to offshore converter stations, linked to offshore wind farms in the Netherlands and Belgium, respectively. Following this decision, the pilot NSIs are expected to proceed with development to the final project assessment stage. Ofgem also plans to develop specific licence conditions for the NSIs, with a particular focus on the special conditions of the electricity interconnector licence to align with the new regime parameters.