Reformed National Pricing
Published 4 November 2026
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This publication is available at https://www.gov.uk/government/publications/energy-independence-bill-factsheets/reformed-national-pricing
Factsheet relating to the Energy Independence Bill.
Summary
Reformed National Pricing (RNP) is a package of electricity market reforms that supports more coordinated, efficient and resilient planning and operation of the GB electricity system. Our plans for a reformed system of national pricing are the best way to deliver an electricity system that is fairer, more affordable, and more secure.
The provisions within the Energy Independence Bill (EIB) enable RNP reforms to be implemented in a coordinated and timely way by allowing modifications to electricity licences, industry codes and related documents where existing processes would be too slow or fragmented.
This ensures change can be delivered on a whole system basis, supporting efficient system planning, reducing costs for consumers, and accelerating progress towards clean, homegrown energy.
Why are we legislating?
The problem
Great Britain’s electricity system is changing rapidly, with growing renewable generation and rising electricity demand. Existing market arrangements were not designed for this transition. Misalignment between generation and network build, and the lack of an overall strategic plan, has resulted in additional costs for both consumers and investors. As a result, investment and operational decisions are not always well aligned with system needs.
Limits of existing powers
The current processes for modifying codes and licences are not suitable for delivery of wide-ranging, strategic reforms such as the RNP package; they can be lengthy and complex, and the objectives against which modifications are typically assessed do not always align with RNP aims. There is also a need to introduce new powers to regulate key areas such as power exchanges and network services.
Why legislation now
Primary legislation provides a clear and time limited framework to deliver RNP reforms in a coordinated, transparent and investible way. It enables the timely delivery of agreed changes, while retaining safeguards such as consultation, reporting and Parliamentary oversight.
What are the government’s objectives with this measure?
RNP supports clean, secure and affordable power by enabling more efficient planning and operation of a renewables-led electricity system. Targeted code and licence changes align investment and operation with long term system needs, reducing whole system costs while maintaining resilience. Smarter planning of electricity infrastructure and better-aligned policy levers could unlock up to £20 billion in benefits between 2030 and 2050.
RNP supports a stable, renewable ready electricity market by enabling effective operation and trading as renewable penetration increases, while providing clearer, market-led investment signals that better reflect coordinated system development. Improving this coordination helps reduce whole system costs and increase long term investor confidence.
How will this measure deliver these objectives?
Providing a clear and investible delivery framework
Legislation provides targeted powers for the energy regulator and the Secretary of State (time-limited and restricted to balancing and trading reforms) to amend codes and licences or introduce new licences (subject to statutory tests, consultation and reporting requirements) to ensure proportionate reform that supports long term investment.
Codes and licences are the legally binding rules governing the electricity market, and updating them makes RNP arrangements mandatory, enforceable and operable by Ofgem, NESO and market participants.
Supporting coordinated system development through investment signals
The RNP package of electricity market reforms in the EIB enables reform of network charging arrangements so that charges better reflect whole system costs and the needs of coordinated system development.
Improving efficiency of system operation and trading arrangements
The package supports reforms to balancing and trading arrangements so the system operator can manage supply and demand more efficiently in real time.