Short-term day ahead (D-1) | National Energy System Operator
Summary
NESO has decided not to implement a short-term day-ahead reactive power market after cost-benefit analysis showed no consumer benefits under current conditions. The decision will be reviewed in 2027 at the earliest. NESO continues work on Commercial Services Agreements for additional reactive power capability, with transmission-connected solutions progressing faster than distribution-connected ones.
Why it matters
NESO is maintaining the status quo on reactive power procurement rather than creating market mechanisms to price this ancillary service. This preserves incumbent generator advantages in reactive power provision while avoiding the complexity of a new market that may not deliver value under current grid conditions.
Key facts
- •Short-term reactive power market rejected after cost-benefit analysis
- •Decision to be reviewed in 2027 at earliest
- •Over 100 responses to reactive power capability RFI totalling 8+ GVAr
- •58 transmission-connected responses (5.4 GVAr) progressing faster than 56 distribution-connected responses (2.9 GVAr)
Areas affected
Related programmes
Memo
Short-term day ahead (D-1) | National Energy System Operator Show/Hide Menu Toggle Add to favourites Close tooltip Sign in to add this page to your favourites Sign in or register Show favourites Close Close tooltip Sign in or register to manage your favourites Sign in or register Help You are now signed in Visit My NESO account to view and manage your dataset subscriptions. Maybe later Go to your account Short-term day ahead (D-1) Our Cost Benefit Analysis and Market Design Framework assessments have demonstrated that there aren’t consumer benefits to the implementation of a short-term reactive power market under current market conditions. The concept could have potential value under more conducive market conditions and NESO will re-visit our decision in 2027 at the earliest. Latest news Commercial Services Agreement (CSAs) Latest news March 2026 Short-term webinar Below you can find the latest material from our Short-term Reactive Power webinar on 10 March 2026. Watch the webinar Download the slides Download the Q&A Commercial Services Agreement (CSAs) Ongoing CSA Work Ongoing CSA Work Update: December 2022 - Request for Information Accessing Additional Voltage Capability 2023 - 2026 Earlier this year, National Grid ESO launched a request for information (RFI) to look at accessing additional reactive capability across England and Wales between 2023 and 2026. We received considerable interest with over 100 solutions and over 8 GVAr volume submitted by providers: 58 transmission-connected responses totalling 5.4 GVAr 56 distribution-connected responses totalling 2.9 GVAr Note the above volumes have not been subject to effectiveness studies. The responses to the RFI have demonstrated that there is considerable additional capability potentially accessible to ESO which is really encouraging. We have also learnt that many parties who have mandated reactive power obligations also have the capability and desire to deliver additional reactive power. The RFI also presented a growing appetite to deliver reactive power capability from units connected at the distribution level which traditionally do not offer such services to ESO, appreciating the challenges around effectiveness. For distribution-connected submissions, ESO require studies from our Distribution Network Operator stakeholders in order to determine the effectiveness and viability of submissions. We continue to progress these discussions and hope to be able share next steps early in the New Year. We have been able to make faster progress on the transmission-connected solutions as these types of assets by nature have much greater effectiveness on the network. We are pleased to be able to offer these solutions a new commercial services agreement to cover capability outside of grid code obligations and we will be reaching out to parties shortly to outline how we intend to implement these agreements within our current processes. We thank parties for their submissions into the RFI and look forward to continuing to progress accessing additional capability within the market. Any further questions, please contact [email protected] logo--facebook