Energy (Windfall Gains in the Energy Sector) (Cap on Market Revenues) Act 2023
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Adjusted surplus revenue | ||
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12. (1) Adjusted surplus revenue means the amount liable, subject to sections 13 and 14 , to be paid by a producer, intermediary or trader in respect of the market cap and shall be calculated by the producer, intermediary or trader in accordance with this section for each month of the relevant period (in this Act referred to as “adjusted surplus revenue”). | ||
(2) Adjusted surplus revenue shall be calculated by adjusting the preliminary surplus revenue as follows: | ||
(a) in relation to a producer— | ||
(i) gains earned by the producer from hedging arrangements in respect of a generating unit shall be added, | ||
(ii) difference charges, other than non-performance difference charges, paid by the producer in respect of a generating unit shall be deducted, | ||
(iii) losses incurred by the producer from hedging arrangements in respect of a generating unit shall be deducted, and | ||
(iv) any monies liable to be paid by the producer to a trader who is not, in relation to the producer, an affiliated person shall be deducted; | ||
(b) in relation to an intermediary— | ||
(i) gains earned by the intermediary from hedging arrangements in respect of a generating unit shall be added, | ||
(ii) difference charges, other than non-performance difference charges, paid by the intermediary in respect of a generating unit shall be deducted, | ||
(iii) losses incurred by the intermediary from hedging arrangements in respect of a generating unit shall be deducted, | ||
(iv) any monies liable to be paid by the intermediary to— | ||
(I) a trader who is not, in relation to the intermediary, an affiliated person, or | ||
(II) a producer who is not, in relation to the intermediary, an affiliated person, | ||
shall be deducted, and | ||
(v) any monies which exceed the intermediary’s monthly capped revenue and which are liable to be paid by the intermediary to a producer who is, in relation to the intermediary, an affiliated person shall be deducted; | ||
(c) in relation to a trader— | ||
(i) gains earned by the trader from hedging arrangements in respect of a generating unit shall be added, | ||
(ii) difference charges, other than non-performance difference charges, paid by the trader in respect of a generating unit shall be deducted, | ||
(iii) losses incurred by the trader from hedging arrangements in respect of a generating unit shall be deducted, | ||
(iv) any monies liable to be paid to the trader by a producer or an intermediary shall be added, | ||
(v) any monies liable to be paid by the trader to— | ||
(I) a producer who is not, in relation to the trader, an affiliated person, or | ||
(II) an intermediary who is not, in relation to the trader, an affiliated person, | ||
shall be deducted, and | ||
(vi) any monies which exceed the trader’s monthly capped revenue and which are liable to be paid by the trader to— | ||
(I) a producer who is, in relation to the trader, an affiliated person, or | ||
(II) an intermediary who is, in relation to the trader, an affiliated person, | ||
shall be deducted. | ||
(3) Where adjusted surplus revenue, calculated in accordance with this section, is negative for a month during the relevant period it should be treated as if it were calculated to be nil for that month. | ||
(4) In this section— | ||
“difference charges” means financial incentives related to reliable production of electricity calculated in accordance with Section F.18 of Part B of the Trading and Settlement Code; | ||
“non-performance difference charges” means difference charges calculated in accordance with Section F.18.7 of Part B of the Trading and Settlement Code. |