Question to the Department for Business, Energy and Industrial Strategy:

To ask the Secretary of State for Business, Energy and Industrial Strategy, with reference to the Smart Systems and Flexibility Plan 2021, published July 2021, what plans he has to adapt current contract reward mechanisms from a singular approach of contracting services such as balancing, ancillary, inertia, voltage and frequency regulation to a more holistic approach of rewarding contracts to technologies according to the entirety of services they provide to the Grid.

Markets which reflect the value of flexibility will be key to achieving a smart, flexible energy system. Our approach in the 2021 Smart Systems and Flexibility Plan centres on creating a best-in-class regulatory framework by removing regulatory and policy barriers and ensuring that markets reflect the value of flexibility to the system. We have set out actions to ensure that flexibility technologies are rewarded for the services they provide to the system including commitments on the Electricity System Operator (ESO) to deliver reforms to its suite of balancing services to enable the transition to a sustainable energy system.

We expect the ESO to maintain the pace of reform needed to operate a net-zero system and facilitate participation from all technologies to unlock the full value of flexibility being offered.