Frequently Asked Questions

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What is the Electricity Settlements Company?

Electricity Settlements Company Ltd (ESC) is a private limited company, wholly owned by the Secretary of State for Business, Energy & Industrial Strategy and which has an independent board of directors.  ESC’s role is to act as the settlement body for the Capacity Market to ensure payment of capacity payments payable to capacity providers who have agreed to provide capacity (or reduce demand) at times of system stress.  ESC also collects capacity market supplier charges and settlement cost levy payments payable by electricity suppliers in order to fund capacity market payments and its operational costs. In addition, ESC collects and manages credit cover required from suppliers and potential capacity providers participating in the capacity auctions which are run by National Grid (as system operator). ESC has overall accountability for the managing the Capacity Market settlement process which includes determining Capacity Market settlement disputes. The administration and operation process for ESC are managed by Low Carbon Contracts Company Ltd.