Energy price cap: technical approach to market wide half hourly settlement
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Energy price cap: technical approach to market wide half hourly settlement
Ofgem proposes adapting the energy price cap wholesale allowance methodology to accommodate Market Wide Half-Hourly Settlement (MHHS), which changes how suppliers are settled when purchasing electricity to match customer demand. The consultation seeks views on setting wholesale allowances that track efficient costs, accounting for cost differences across customer groups, and developing time-of-use price cap variants. Responses are due by 5 May 2026.
This consultation addresses a structural tension: MHHS enables time-of-use pricing that could reduce system costs, but the price cap's design as a single flat rate prevents consumers from seeing these price signals. The proposal to create time-of-use cap variants attempts to preserve consumer protection while allowing demand flexibility, though the mechanism for setting these variants will determine whether they genuinely reflect system costs or remain administratively smoothed.
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Energy price cap: technical approach to market wide half hourly settlement | Ofgem
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Energy price cap: technical approach to market wide half hourly settlement
Publication type:
Call for input
Publication date:
25 March 2026
Closing date:
05 May 2026
Status:
Open
Topic:
Energy pricing rules
Subtopic:
Energy price cap
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We are seeking views on how to adapt the wholesale allowance of the energy price cap to accommodate Market Wide Half-Hourly Settlement (MHHS).
Call for input description
The call for input sets out our initial thinking and seeks views on how the energy price cap may need to develop to accommodate Market Wide Half-Hourly Settlement (MHHS). MHHS will result in changes in how suppliers are settled when purchasing electricity to match their customers’ demand.
This call for input sets out our views on:
setting an electricity wholesale allowance that allows the energy price cap to track and reflect the efficient costs of serving energy price cap customers over time
if and how we account for differences in costs to serve these customers across customer groups and suppliers when setting the energy price cap
developing the energy price cap for customers who want to change how and when they use electricity, for example pay by ‘time of use’ where the price varies depending on when customers use it
To adapt the energy price cap, we consider we need to:
update how we set the energy price cap level for single-rate customers (those who pay the same price for electricity regardless of when they use it)
design at least one time of use energy price cap variant (for those who pay different prices depending on when they use electricity)
consider whether further risk mitigations are required to address differences in costs to serve suppliers’ customer bases
Who should respond
We would like views from people who have an interest in how we design the energy price cap. This includes:
energy suppliers
energy industry bodies
network companies
consumer groups
charities
consumers
How to respond
Submit your response by 5 May 2026 by emailing priceprotectionpolicy@ofgem.gov.uk .
Call for input documents
Energy price cap: technical approach to market wide half hourly settlement [PDF, 695.20KB]
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Interview with Helen Adey: Putting customers first in the transition to Half-Hourly Settlement
Market-Wide Half-Hourly Settlement systems went live in September 2025, with first Wave 1 participants completing qualification and beginning migration of 30 million supply points. The programme transitions from implementation to business-as-usual operation of settlement systems and the Data Integration Platform. Elexon served as Implementation Manager rather than Ofgem leading directly, coordinating industry delivery through working groups and volunteer early adopters.
This represents implementation detail for an already-decided structural reform rather than new policy. The collaborative governance model may become a template for future industry programmes, shifting delivery responsibility from regulator to industry body. Success depends on whether suppliers use half-hourly data to create new products rather than simply meeting compliance requirements.
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The transition to Market-Wide Half-Hourly Settlement (MHHS) marks one of the most significant operational changes the UK energy industry has undertaken in recent years. With systems now live and migrations underway, the programme is moving into a new phase focused on scaling participation across the market. On Wednesday 11 March, Elexon announced that the first Wave 1 participants have successfully completed Qualification. This represents a key milestone for the programme, as participants progress through the end-to-end journey towards migration. Speaking in an expert interview with BFY Group, Helen Adey, Director of Settlement Services at Elexon and Senior Responsible Owner for the MHHS Programme, shared insights on industry collaboration, supplier readiness and the opportunities the reform will unlock for consumers. A New Approach to Programme Delivery The MHHS programme introduced a shift in how major industry change programmes are delivered. While initiatives such as Faster Switching were previously led by the regulator, Ofgem appointed Elexon as Implementation Manager for MHHS, giving the organisation responsibility for coordinating delivery across the industry. Helen explains that this created a dual challenge. “We had two roles,” she said. “One was to coordinate all of industry to make sure that we could deliver the programme and move to half-hourly settlement. But also, Elexon had to deliver its own settlement systems as well.” To accelerate progress, the programme introduced a group of volunteer participants who built and tested systems ahead of the wider market. While the approach helped shorten the overall timeline, it also required significant commitment from those early adopters. “There were a number of participants who wanted to be in the early adopters,” Helen said. “But it also meant there was a lot of burden on those organisations who had to invest in testing and get involved earlier than the rest of the market.” Collaboration Across the Industry A key factor in the programme’s progress has been the level of collaboration across industry participants. The governance structure built around working groups, advisory forums and steering committees, has allowed suppliers and other stakeholders to shape the design and resolve issues collectively. “One of the strengths of the programme has been the governance around it,” Helen explained. “A lot of collaboration and problem solving happened at working group level, and that’s where suppliers were able to shape some of the outcomes they were looking for.” This collaborative environment has also reduced the need for issues to be escalated to senior governance forums. “Most things were resolved at the working level,” she added. “There were only a couple of design points that needed escalation.” Communication has also played a critical role in maintaining momentum. Helen highlighted the importance of the Programme Participant Coordinator (PPC), a dedicated team responsible for coordinating communications across the industry. “They were instrumental in driving readiness, communication and checklists – ensuring that all of industry had the opportunity to understand what needed to be done and by when,” Helen said. From System Go-Live to Market Migration The programme reached a major milestone when the new systems went live in September 2025. However, Helen emphasised that this was only the beginning of the transformation. “Going live was one thing – that’s just switching the systems on,” she said. “The proof really is about getting migration started.” The migration process will ultimately involve around 30 million MPANs, moving them into the new half-hourly settlement framework. “When we saw the first MPANs move through, that was really exciting,” Helen said. “That is the beginning of a 30 million MPAN migration.” With the systems now operational, Elexon has transitioned from programme delivery into operating the new services as part of business-as-usual operations, including management of the Data Integration Platform. Readiness Is More Than a Technical Exercise For suppliers preparing to migrate, readiness goes far beyond system implementation. “This is a complicated change for industry,” Helen explained. “Readiness needs to be embraced as more than just a system change. It goes back into knowledge, processes and really understanding where the touchpoints are that MHHS will change for businesses.” Suppliers must also complete a formal qualification process to demonstrate they are ready to operate in the new settlement environment. “The paperwork is really just proof that suppliers have all the systems and processes in place,” Helen said. “Engaging properly with that qualification process is the way forward to make sure the industry meets the milestones we need.” Unlocking the Value of Half-Hourly Data While the programme itself is focused on improving settlement accuracy and efficiency, Helen believes the true benefits will come from how the industry uses the new capabilities. “Delivering half-hourly settlement means suppliers can take greater benefit across their end-to-end processes,” Helen said. More granular data will enable suppliers to create innovative products and provide consumers with greater insight into their energy usage. “What good looks like is that people don’t just sit back and say ‘phew, that was delivered’,” Helen said. “It’s about asking: what can this give us, and how can we really take advantage of it to deliver value for consumers?” Maintaining Industry Momentum As the programme moves through its migration phase, Helen emphasised the importance of continued collaboration across the energy sector. “It’s phenomenal what we’ve been able to achieve so far as an industry,” Helen said. “But we need to stand shoulder to shoulder to keep delivering this.” With millions of supply points still to migrate and further milestones ahead, the next stage of the programme will test the industry’s ability to operate the new framework at scale. However, if the collaborative approach seen so far continues, MHHS has the potential not only to modernise settlement but to reshape how energy is managed, priced and consumed across the UK market. Watch the full interview. The post Interview with Helen Adey: Putting customers first in the transition to Half-Hourly Settlement appeared first on Elexon .
This consultation is open for responses
Closes 5 May 2026 (30 days remaining)
Summary
Ofgem: Ofgem proposes adapting the energy price cap wholesale allowance methodology to accommodate Market Wide Half-Hourly Settlement (MHHS), which changes how suppliers are settled when purchasing electricity to match customer demand. The consultation seeks views on setting wholesale allowances that track efficient costs, accounting for cost differences across customer groups, and developing time-of-use price cap variants. Responses are due by 5 May 2026. Elexon: Market-Wide Half-Hourly Settlement systems went live in September 2025, with first Wave 1 participants completing qualification and beginning migration of 30 million supply points. The programme transitions from implementation to business-as-usual operation of settlement systems and the Data Integration Platform. Elexon served as Implementation Manager rather than Ofgem leading directly, coordinating industry delivery through working groups and volunteer early adopters.