Part 3: Market operation service providers

3.1 Appointment of market operation service providers

(1) The Authority must appoint a person or persons to perform each of the following market operation service provider roles:
- (a) registry manager:
- (b) reconciliation manager:
- (c) [Revoked]:
- (d) clearing manager:
- (e) FTR manager:
- (f) WITS manager:
- (g) [Revoked]:
- (h) any other role identified in regulations as a market operation service provider role and for which market operation services are provided under this Code.
(2) [Revoked].
(3) The system operator is also a market operation service provider, but clauses 3.3, 3.10 and 3.15 do not apply to the system operator.
(4) The Authority may also appoint a person or persons to act as an industry service provider in providing any service under this Code.

Compare: SR 2003/374 r 30

Clause 3.1(3): amended, on 19 May 2016, by clause 5 of the Electricity Industry Participation Code Amendment (System Operator and Alignment with Statutory Objective) 2016.

Clause 3.1(1): substituted, on 5 October 2017, by clause 14(1) of the Electricity Industry Participation Code Amendment (Code Review Programme) 2017.

Clause 3.1(1)(g): revoked, on 21 December 2021, by clause 5 of the Electricity Industry Participation Code Amendment (Automatic Under-Frequency Load Shedding Systems) 2021.

Clause 3.1(2): revoked, on 5 October 2017, by clause 14(2) of the Electricity Industry Participation Code Amendment (Code Review Programme) 2017.

Clause 3.1(1)(c): revoked, on 1 November 2022, by clause 5 of the Electricity Industry Participation Code Amendment (Real Time Pricing) 2022.

3.2 Functions, rights, powers, and obligations of market operation service providers

A market operation service provider has the functions, rights, powers, and obligations set out in relation to that market operation service provider under this Code and Part 2 and Subpart 1 of Part 4 of the Act.

Compare: SR 2003/374 r 31

Clause 3.2: amended, on 5 October 2017, by clause 15 of the Electricity Industry Participation Code Amendment (Code Review Programme) 2017.

3.2A

Market operation service providers to assist Authority to give effect to Authority’s main statutory objective

(1) Each market operation service provider must perform its obligations under this Code in a way that assists the Authority to give effect to the Authority's main objective in section 15 of the Act.
(2) The system operator must progressively increase the extent to which it assists the Authority to give effect to the Authority’s main objective in section 15 of the Act.
(3) The system operator is not required to comply with subclause (1) when exercising discretion in real time in performing its functions.
(4) This clause does not permit a market operation service provider to contravene any other provision of this Code.

Clause 3.2A: inserted, on 19 May 2016, by clause 6 of the Electricity Industry Participation Code Amendment (System Operator and Alignment with Statutory Objective) 2016.

Clause 3.2A Heading: amended, on 1 March 2024, by clause 9(1) of the Electricity Industry Participation Code Amendment (Code Review Programme) 2024.

Clause 3.2A(1) and (2): amended, on 1 March 2024, by clause 9(2) of the Electricity Industry Participation Code Amendment (Code Review Programme) 2024.

3.3 Term of appointment of market operation service provider

(1) A market operation service provider’s term of appointment, and the date on which the term begins, is as agreed between the Authority and the market operation service provider.
(2) The Authority may at any time terminate, re-appoint, or change the appointment of a person as a market operation service provider, subject to the terms of any agreement between that market operation service provider and the Authority.

Compare: SR 2003/374 r 32(1) and (2)

3.4 Terms of market operation service provider agreements

(1) The remuneration of a market operation service provider is as agreed between the Authority and the market operation service provider.
(2) The Authority and the market operation service provider may agree on any other terms and conditions, not inconsistent with the functions, rights, powers, and obligations of that market operation service provider under this Code and Part 2 and Subpart 1 of Part 4 of the Act.

Compare: SR 2003/374 r 33

Clause 3.4(2): amended, on 19 December 2014, by clause 5 of the Electricity Industry Participation Code Amendment (Minor Code Amendments) (No 3) 2014.

Clause 3.4(2): amended, on 5 October 2017, by clause 16 of the Electricity Industry Participation Code Amendment (Code Review Programme) 2017.

3.5 Publication of market operation service provider agreements

The Authority must publish each market operation service provider agreement.

Compare: SR 2003/374 r 34

Clause 3.5: amended, on 5 October 2017, by clause 17 of the Electricity Industry Participation Code Amendment (Code Review Programme) 2017.

3.6 Insurance cover

Each market operation service provider must at all times maintain any insurance cover that is required by the Authority, on terms and in respect of risks approved by the Authority, with an insurer approved by the Authority.

Compare: SR 2003/374 r 36

Force majeure provisions relating to market operation service providers

3.7 Relief of obligation because of force majeure

(1) A market operation service provider is relieved of an obligation under this Code and under the Electricity Industry (Enforcement) Regulations 2010 to the extent that, and for so long as, it is unable to perform the obligation as a result of a force majeure event.
(2) Subclause (1) applies only—
- (a) if the market operation service provider promptly advises the Authority of—
  - (i) the details of the force majeure event; and
  - (ii) the obligation that cannot be performed; and
  - (iii) the likely duration of the inability to perform the obligation; and
- (b) for so long as the market operation service provider uses its reasonable endeavours to overcome the inability to perform the obligation from which it seeks relief and to remove or mitigate the effect of the force majeure event; and
- (c) if the market operation service provider provides the Authority with reports in accordance with subclauses (3) and (4).
(3) As soon as practicable, but in any event no later than by the end of the month following the month in which the market operation service provider advises the Authority of a force majeure event under subclause (2)(a), the market operation service provider must provide the Authority with a written report that sets out—
- (a) the full details of the force majeure event; and
- (b) the actions the market operation service provider is taking or intends to take to comply with subclause (2)(b); and
- (c) the proposed timeline for completing the actions.
(4) By the end of each following month (unless the Authority advises that reports may be provided less frequently or are not required) the market operation service provider must provide the Authority with a written report that updates the information previously provided and includes any other matters related to the force majeure event that the Authority requests.
(5) The Authority must publish the information provided under subclause (2)(a) and the reports provided under subclauses (3) and (4) as soon as practicable after receiving the information.
(6) Despite subclause (5), the Authority must not publish or otherwise make available to the public any information or any part of a report if the market operation service provider advises the Authority (with reasons) that the market operation service provider considers that it would have good reason to refuse to supply the information or the part under clause 2.6 or clause 2.7.

Compare: SR 2003/374 r 38

Clause 3.7: substituted, on 1 November 2012, by clause 5 of the Electricity Industry Participation (Force Majeure) Code Amendment 2012.

Clause 3.7(5): amended, on 5 October 2017, by clause 18(1) of the Electricity Industry Participation Code Amendment (Code Review Programme) 2017.

Clause 3.7(6): amended, on 5 October 2017, by clause 18(2) of the Electricity Industry Participation Code Amendment (Code Review Programme) 2017.

3.8 Effect of relief

If a market operation service provider is relieved of an obligation under clause 3.7,—
- (a) the market operation service provider is not liable for a breach of this Code or with the Electricity Industry (Enforcement) Regulations 2010 in respect of that obligation during the period for which the relief applies under that clause; and
- (b) any costs arising from the relief from the obligation lie where they fall, except that the Authority and the market operation service provider may agree to adjust the remuneration of the market operation service provider.

Compare: SR 2003/374 r 39

Clause 3.8(a): amended, on 1 November 2012, by clause 6 of the Electricity Industry Participation (Force Majeure) Code Amendment 2012.

3.9 Authority may contract elsewhere during force majeure event

For the duration of a force majeure event, the Authority may contract with others for the performance of an obligation that the market operation service provider fails to perform in accordance with this Code or with the Electricity Industry (Enforcement) Regulations 2010, or the relevant market operation service provider agreement.

Compare: SR 2003/374 r 40

Clause 3.9: amended, on 1 November 2012, by clause 7 of the Electricity Industry Participation (Force Majeure) Code Amendment 2012.

3.10 Authority may terminate market operation service provider agreements

If a force majeure event results in a market operation service provider being relieved of a material obligation for more than 30 continuous days, the Authority may terminate the relevant market operation service provider agreement by written notice with immediate effect.

Compare: SR 2003/374 r 41(1)

Disclosure to Authority

3.11 Disclosure to Authority

Each market operation service provider is entitled to disclose to the Authority all information received by it from any person as part of its provision of services under this Code and Part 2 and Subpart 1 of Part 4 of the Act.

Compare: SR 2003/374 r 42

Clause 3.11: amended, on 5 October 2017, by clause 19 of the Electricity Industry Participation Code Amendment (Code Review Programme) 2017.

Performance standards

3.12 Performance standards to be agreed

The Authority and the relevant market operation service provider must, at the beginning of each year ending 30 June, seek to agree on a set of performance standards against which the market operation service provider’s actual performance must be reported and measured at the end of the year ending 30 June.

Compare: SR 2003/374 r 43

Clause 3.12: amended, on 5 October 2017, by clause 20 of the Electricity Industry Participation Code Amendment (Code Review Programme) 2017.

Accountability of market operation service providers via self-review

3.13 Self-review must be carried out by market operation service providers

(1) Each market operation service provider must conduct, on a monthly basis, a self-review of its performance.
(2) The review must concentrate on the market operation service provider’s compliance with—
- (a) its obligations under this Code and Part 2 and Subpart 1 of Part 4 of the Act; and
- (b) the operation of this Code and Part 2 and Subpart 1 of Part 4 of the Act; and
- (c) any performance standards agreed between the market operation service provider and the Authority; and
- (d) the provisions of the market operation service provider agreement.

Compare: SR 2003/374 r 44

Clause 3.13(2)(a) and (b): amended, on 5 October 2017, by clause 21 of the Electricity Industry Participation Code Amendment (Code Review Programme) 2017.

3.14 Market operation service providers must report to Authority

(1) Each market operation service provider must prepare a written report for the Authority on the results of the review carried out under clause 3.13.
(1A) A market operation service provider must provide the report prepared under subclause (1) to the Authority—
- (a) within 10 business days after the end of each calendar month except after the month of December:
- (b) within 20 business days after the end of the month of December.
(2) The report must contain details of—
- (a) any circumstances identified by the market operation service provider in which it has failed, or may have failed, to comply with its obligations under this Code and Part 2 and Subpart 1 of Part 4 of the Act; and
- (b) any event or series of events that, in the market operation service provider’s view, highlight an area where a change to this Code may need to be considered; and
- (c) any other matters that the Authority, in its reasonable discretion, considers appropriate and asks the market operation service provider, in writing within a reasonable time before the report is provided, to report on.

Compare: SR 2003/374 r 45

Clause 3.14(1): replaced, on 5 October 2017, by clause 22(1) of the Electricity Industry Participation Code Amendment (Code Review Programme) 2017.

Clause 3.14(1A): inserted, on 5 October 2017, by clause 22(1) of the Electricity Industry Participation Code Amendment (Code Review Programme) 2017.

Clause 3.14(2)(a): amended, on 5 October 2017, by clause 22(2) of the Electricity Industry Participation Code Amendment (Code Review Programme) 2017.

3.14A

Market operation service providers to self-report breaches to Authority

(1) If a market operation service provider believes on reasonable grounds that it has breached a provision of this Code, the market operation service provider must report the alleged breach to the Authority in writing as soon as practicable after the market operation service provider becomes aware of the alleged breach.
(2) The written report must specify—
- (a) the provision of this Code allegedly breached; and
- (b) the date and time the alleged breach occurred; and
- (c) the circumstances relating to the alleged breach, including any participants the market operation service provider believes the alleged breach may have affected.

Clause 3.14A: inserted, on 1 November 2018, by clause 5 of the Electricity Industry Participation Code Amendment (Code Review Programme) 2018.

Review of market operation service providers by Authority

3.15 Review of market operation service providers

(1) At the end of each year ending 30 June, the Authority may review the manner in which each market operation service provider has performed its duties and obligations under this Code and Part 2 and Subpart 1 of Part 4 of the Act.
(2) The review must concentrate on the market operation service provider’s compliance with—
- (a) its obligations under this Code and Part 2 and Subpart 1 of Part 4 of the Act; and
- (b) the operation of this Code and Part 2 and Subpart 1 of Part 4 of the Act; and
- (c) any performance standards agreed between the market operation service provider and the Authority; and
- (d) the provisions of the market operation service provider agreement.

Compare: SR 2003/374 r 46

Clause 3.15: amended, on 5 October 2017, by clause 23 of the Electricity Industry Participation Code Amendment (Code Review Programme) 2017.

Market operation service provider software

3.16 Software specifications for market operation service providers

(1) This clause and clauses 3.17 and 3.18, apply only to software that the market operation service provider agreement requires the market operation service provider to use.
(2) Unless otherwise agreed by the Authority in writing, the software specification for all software to be used by a market operation service provider must be set out or described in the market operation service provider agreement for that market operation service provider.
(3) Each market operation service provider must ensure that its software performs in accordance with the relevant software specification and this Code.

Compare: SR 2003/374 r 51(1AA) to (2)

3.17 Market operation service provider must arrange audit of software

(1) Unless otherwise agreed by the Authority in writing, each market operation service provider must arrange and pay for a suitably qualified independent person approved by the Authority to carry out—
- (a) before any software is first used by the market operation service provider in relation to this Code and Part 2 and Subpart 1 of Part 4 of the Act, an audit of all software and software specifications to be used by the market operation service provider; and
- (b) an annual audit of all software used by the market operation service provider, within 1 month after 1 March in each year; and
- (c) an audit of any changes to the software or the software specification, before it is used by the market operation service provider.
(2) A market operation service provider must ensure that the person carrying out an audit under subclause (1) provides a report to the Authority as to—
- (a) the performance (including likely future performance) of all of the software in accordance with the relevant software specification; and
- (b) any other matters that the Authority requires.

Compare: SR 2003/374 r 52

Clause 3.17(2): amended, on 1 February 2016, by clause 6 of the Electricity Industry Participation Code Amendment (Code Review Programme) 2015.

Clause 3.17(1)(a): amended, on 5 October 2017, by clause 24 of the Electricity Industry Participation Code Amendment (Code Review Programme) 2017.

3.18 Requirements for using software

A market operation service provider may not use any software unless—
- (a) the market operation service provider has provided to the Authority, in respect of that software, an auditor’s report issued in accordance with clause 3.17(2); or
- (b) the Authority has agreed that no audit is required under clause 3.17(1).

Compare: SR 2003/374 r 53

Electricity Industry Participation Code 2010