In this consultation, Ofgem asked for views on the Market Facilitator policy framework, covering the setting up of the market facilitator, its functions, deliverables and performance arrangements.
The consultation closed on 11 February 2025.
A summary of our response
In our response, we supported most of Ofgem’s proposals and provided a few recommendations, based on our evolving thinking and stakeholder feedback—particularly from the detailed design workshops we have run since November 2024.
We will continue working with Ofgem and industry to develop the Market Facilitator role, ensuring its scope is clear and effective, with robust governance to create open, transparent, and well-coordinated flexibility markets.
Key points from our response:
- We fully support Ofgem’s proposal to bring the Market Facilitator go-live date forward and remain committed to delivering at pace to meet end-of-year go-live target.
- We support the proposed scope, including the inclusion of most Commercial Ancillary Services and the plan to expand to include other markets in the second delivery period. We will work with NESO to align market arrangements that add value and benefit stakeholders. While we agree with excluding stability and reactive power for now, we suggest Ofgem considers their future inclusion if they add value.
- While the Market Facilitator should not be the sole actor/decision maker in innovation, we propose it takes on a greater role alongside others to improve coordination and address the current fragmented landscape. This approach will help track and leverage outputs from key innovation projects.
- We fully support Ofgem’s proposed performance assessment framework. Given the complexity of flexibility markets, performance metrics should be specific to the Market Facilitator and within Elexon’s control. We suggest a few key metrics for assessment but are open to working with Ofgem to refine them as thinking evolves.
- We are confident in meeting Ofgem’s performance expectations and have several activities underway to ensure the Market Facilitator is operational by year-end. While we are also confident in meeting the 2028 target, we highlight key interdependencies that must be considered.