We agree that the wholesale electricity market arrangements need reform to help decarbonise power in a way that secures supply and ensures the system can function efficiently, including more locational signals. In principle, we find the argument for locational pricing appealing, but we are concerned about its deliverability and its potential impact on investor confidence. The Government must satisfy itself that any reforms it does pursue do not create an investment hiatus, which would put the...

We agree that the wholesale electricity market arrangements need reform to help decarbonise power in a way that secures supply and ensures the system can function efficiently, including more locational signals. In principle, we find the argument for locational pricing appealing, but we are concerned about its deliverability and its potential impact on investor confidence. The Government must satisfy itself that any reforms it does pursue do not create an investment hiatus, which would put the 2035 target at risk. Type: recommendation | Number: 58 | Paragraph: 237 | Response status: accepted Government response: 144. The Government published its first consultation on the Review of Electricity Market Arrangements in 2022, and published the summary of responses in March 2023. The Government has outlined options for reform it will explore, which includes reforms to wholesale market arrangements (e.g. shortenin