Capacity Market (CM)
The GB scheme that pays capacity providers to be available during periods of system stress, procured through auctions held ahead of each delivery year.
The Capacity Market pays generation, storage and demand-side response for being available when the system is tight. Capacity is procured through pay-as-clear auctions held ahead of the delivery year — a main auction roughly four years ahead (T-4) and a top-up closer to delivery (T-1) — with providers paid per kilowatt of de-rated capacity per year.
Providers that fail to deliver during a system stress event face penalties, and different technologies receive different de-rating factors reflecting their expected availability — a key input for battery storage, where de-rating depends on duration.
For flexible assets, CM agreements provide a contracted, availability-based revenue floor that sits alongside merchant streams in the revenue stack.
Structuring against this in a live deal?
ETC prices and executes PPAs across GB — founder-led, from indicative quote to signed contract.