Page type: primary-anchored (mirrors Electricity Supply Licence Standard Conditions)

Electricity Supply Licence -- Standard Conditions

Last updated: 2026-04-05 Source: supply-slc.md (consolidated to 1 August 2025)

The Electricity Supply Licence is granted by Ofgem (GEMA) under section 6(1)(d) of the Electricity Act 1989. It authorises the holder to supply electricity to premises in Great Britain. The Standard Licence Conditions (SLCs) are the rules every licensed electricity supplier must follow. They are the single most important regulatory instrument governing the retail electricity market.

This is a very large instrument -- 611 pages, approximately 75 SLCs (62 active), organised in three Sections plus two Schedules. Given the splitting threshold, this parent page provides a structural overview. Detailed sub-pages cover each major section.

Structure at a glance

Section A: All Suppliers (SLCs 0-21D)

Customer fairness (SLCs 0, 0A)

The two fairness conditions are the overarching behavioural standards. SLC 0 applies to dealings with Domestic Customers (including those in Vulnerable Situations); SLC 0A applies to Non-Domestic Customers. Both require the licensee to achieve "Standards of Conduct" -- behaving fairly, honestly, transparently; providing complete and accurate information; making it easy to contact; and putting things right promptly. SLC 0 only applies to suppliers who have been given a Domestic Supply Direction (SLC 3) or where the Secretary of State has activated Section B.

Definitions and interpretation (SLCs 1-3)

SLC 1 contains approximately 130 defined terms. Key definitions include: Customer, Domestic Customer, Non-Domestic Customer, Charges for the Supply of Electricity, Unit Rate, Standing Charge, Tariff, Domestic Supply Contract, Deemed Contract, Fixed Term Supply Contract, Evergreen Supply Contract, Smart Metering System, Prepayment Meter. SLC 2 sets interpretation rules. SLC 3 governs when Section B (domestic conditions) applies.

Financial resilience (SLCs 4A-4D)

This cluster was introduced following the 2021-22 supplier failure crisis. It is the most significant post-crisis regulatory reform: - SLC 4A (Operational capability): Licensee must maintain robust capability, systems, and processes. - SLC 4B (Financial responsibility): Licensee must maintain adequate Capital and Liquidity. From 31 March 2025, domestic suppliers must meet a Capital Floor (Adjusted Net Assets >= GBP 0/customer) and a Capital Target (GBP 57.50/customer). Breach triggers Transition Controls (sales ban, non-essential payments ban) and a Capitalisation Plan. Annual Adequacy Self-Assessment required. Trigger Points for financial distress must be reported to Ofgem within 7 days. - SLC 4C (Fit and proper): Must not appoint unfit persons to positions of Significant Managerial Responsibility. - SLC 4D (Credit balance protection): Where Ofgem directs (under 4B.23), licensee must protect domestic customer credit balances through Standby Letters of Credit, First Demand Guarantees, or Credit Balance Trust Accounts.

Transparency and oversight (SLCs 5, 5A, 5B)

SLC 5 requires the licensee to provide Information to the Authority on request and retain Relevant Data (wholesale transaction details) for at least 5 years. SLC 5A requires proactive openness -- disclosing circumstances that risk consumer detriment. SLC 5B allows Ofgem to require Independent Audits of financial stability, customer service, or milestone compliance.

Continuity of supply (SLCs 7-10)

SLC 7 governs Deemed Contracts (which arise automatically when a customer takes supply without an express contract). Key protections: deemed contracts must not be unduly onerous (7.3), must not include termination fees or fixed terms (7.6A), and must terminate when a Last Resort Supply Direction takes effect (7.1). SLC 7A provides protections for Micro Business Consumers (annual consumption <= 100,000 kWh), including notification requirements, renewal protections, and termination rights. SLCs 8-9 govern the Supplier of Last Resort process. SLC 10 covers licence restriction/revocation.

Industry codes (SLCs 11, 11A, 11B)

SLC 11 requires compliance with the Distribution Code, Grid Code, DCUSA, CUSC, BSC, and the Fuel Security Code. SLC 11B requires compliance with and party status in the Retail Energy Code. SLC 11 also includes cooperation obligations for Significant Code Reviews (11.13-11.15).

Metering and theft (SLCs 12, 12.A, 13-14A)

SLC 12 covers metering obligations including prepayment meter services and advanced metering requirements. SLC 12.A sets standards for theft of electricity investigations, including protections for vulnerable customers during investigations.

Financial reporting and notifications (SLCs 19A-19D)

Large suppliers (50k+ customers) must publish Consolidated Segmental Statements (19A). All suppliers must notify Ofgem of trade sales, mergers, changes of control, and management changes (19AA). Cross-subsidies between supply and other businesses are prohibited (19B). All suppliers must maintain Customer Supply Continuity Plans (19C). Trade Sales must not subvert the SoLR process (19D).

Information for customers (SLCs 20-21D)

Fuel mix disclosure (21), meter-based billing requirements (21B), backbilling protections (21BA), and tariffs with environmental claims (21D).

Section B: Domestic Suppliers (SLCs 22-32A)

See: supply-licence-domestic.md

This section applies only where a Domestic Supply Direction has been given. It contains the core consumer protection framework: - Contract regulation (22-24A): Duty to offer supply, unit rate / standing charge structure requirements, fixed term contract protections, dead tariff prohibition. - Price cap (28AD): The default tariff cap -- the single most consequential condition for domestic bills. Sets a maximum charge per customer calculated from formulae covering wholesale costs, network costs, policy costs, operating costs, EBIT margin, headroom, and other allowances. Updated quarterly. - Prepayment protection (28A, 28AA): Separate charge restriction for prepayment customers, with regional Benchmark Maximum Charges. - Priority Services Register (26): Must maintain a register of vulnerable customers. - Payments and disconnections (27, 27A, 28): Protections around security deposits, disconnection, self-disconnection, and prepayment meters. - Customer information (31E-31I): Overarching information requirements, engagement, billing, price change notifications.

Section C: All Suppliers (SLCs 33-60)

See: supply-licence-section-c.md

This section covers scheme-specific obligations: - Feed-in Tariffs (33-34): Mandatory FIT Licensees (250k+ customers) must make FIT Payments. Schedule A runs to ~235 pages covering accreditation, payment calculation, levelisation, and compliance. - Green Deal (35-38): Central Charge Database, Green Deal obligations and information, GDAA. - Offtaker of Last Resort (38A): FIT generator last-resort offtaker. - Smart metering (39-56): The largest single cluster (~140 pages). Roll-out obligations, installation codes of practice, in-home displays, consumer engagement, security controls, consumption data access, Smart Energy Code compliance, DCC enrolment, Alt HAN arrangements. - Smart Export Guarantee (57-58): SEG Licensees must offer export tariffs to small-scale low-carbon generators. Schedule A covers eligibility, payments, and administration. - Alternative fuel payments (59): Secretary of State direction power for alternative fuel payment schemes. - Elexon ownership (60): Must hold one share in Elexon if directed.

Defined terms

Approximately 350 defined terms across the instrument. The main definitions register is in SLC 1.3 (~130 terms). Additional definitions are scattered across condition-specific definition sections. See supply-slc.md for the full register.

Cross-references

This instrument references approximately 15 external instruments:

Industry codes (requires compliance): - Balancing and Settlement Code (BSC) - Connection and Use of System Code (CUSC) - Grid Code - Distribution Code - Distribution Connection and Use of System Agreement (DCUSA) - Retail Energy Code (REC) - Smart Energy Code (SEC) - Fuel Security Code

Statutes: - Electricity Act 1989 - Utilities Act 2000 - Energy Act 2004, 2008, 2011, 2023 - Domestic Gas and Electricity (Tariff Cap) Act 2018 - Smart Meters Act 2018

Statutory instruments: - Feed-in Tariffs Order 2012 - Smart Export Guarantee Order 2019 - Warm Home Discount Regulations 2011 - Electricity and Gas (Internal Markets) Regulations 2011 - Energy Market Investigation (Electricity Transmission Losses) Order 2016 - Energy Market Investigation (Database) Order 2016

Other licences: - Electricity System Operator Licence - Distribution Licence - Generation Licence - Interconnector Licence - DCC Licence

Current status

• Consolidated to 1 August 2025 (SLCs 0 and 7 last modified 1 July 2024)
• The Default Tariff Cap (SLC 28AD) is updated quarterly by Ofgem
• The supplier financial resilience package (SLCs 4A-4D, 5A, 5B, 19AA, 19C, 19D) has been in force since 2023-24, with the Capital Floor effective from 31 March 2025
• The FIT scheme is closed to new applicants but existing obligations continue
• Smart metering roll-out obligations remain active
• SLC 22B (tariff availability to new and existing customers) has a sunset clause at 22B.5: ceases effect at 23:59 on 31 March 2024, extendable annually by Authority
• 17 SLCs are "Not Used" placeholders (4, 7B, 16-19, 22F, 25A, 25C, 28B, 29, 31-31D, 53)
• Known drafting issues in the consolidated PDF: SLC 5A heading typo ("Priniciple"), SLC 7.4 dual "(b)" sub-paragraph labelling error

Character positions

[No character positions catalogued yet for this instrument.]

Debate

[No debate section content yet.]