Correspondence

Final auction parameters, T-1 and T-4 Capacity Market auctions

Published 10 February 2026

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This publication is available at https://www.gov.uk/government/publications/capacity-market-auction-parameters-letter-from-desnz-to-neso-february-2026/final-auction-parameters-t-1-and-t-4-capacity-market-auctions

Table 1: Final auction parameters

T-1 Auction for delivery in 2026/27 T-4 Auction for delivery in 2029/30
Auction target capacity 6.3 GW 39.4 GW
Demand curve: minimum capacity at price cap 5.3 GW 37.9 GW
Demand curve: maximum capacity at £0 7.3 GW 40.9 GW
Reliability Standard 3 hours LOLE 3 hours LOLE
Net CONE £49/kW/yr £49/kW/yr
Price Cap £75/kW/yr £75/kW/yr
Price Taker Threshold £25/kW/yr £25/kW/yr
15-year agreement threshold N/A[footnote 1] £350/kW[footnote 2]
9-year agreement threshold (for eligible Declared Low Carbon CMUs only) N/A[footnote 1] £205/kW[footnote 3]
3-year agreement threshold (for non-Three Year Zero Capex Threshold CMUs) N/A[footnote 1] £65/kW[footnote 4]
3-year agreement zero threshold (for eligible Three Year Zero Capex Threshold CMUs only)[footnote 5] N/A[footnote 1] £0/kW
Indexation N/A[footnote 1] 2024/25

  1. Multi-year agreements are not awarded in the T-1 auction. ↩ ↩2 ↩3 ↩4 ↩5

  2. The 15-year agreement threshold is adjusted from the previous T-4 value (for the 2028/29 Delivery Year) for inflation, indexed to the 2024/25 inflation level, and rounded to the nearest £5. ↩

  3. As noted in the July 2025 auction parameters, the 9-year agreement threshold has been introduced for the upcoming auctions, as described in the Phase 2 response update. The threshold is set as the midpoint between the 3-year (for non-Three Year Zero Capex Threshold CMUs) and 15-year agreement thresholds, rounded to the nearest £5. ↩

  4. As per July 2025, the 3-year agreement threshold (for non-Three Year Zero Capex Threshold CMUs) was decreased to £65/kW to facilitate lifetime extensions as described in this consultation response. ↩

  5. As defined in Rule 1.2 of the Capacity Market Rules, as described in the Phase 2 response update. ↩

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