The Contracts for Difference (Electricity Supplier Obligations) Regulations 2014

Repayment of mutualised amounts

18.—(1) Where the CFD counterparty has issued a mutualisation notice in respect of a failure of an electricity supplier (“the defaulting supplier”) to make a relevant payment, and subsequently recovers any amount from that supplier in respect of that failure, that amount must be paid to electricity suppliers who were required to pay mutualisation amounts in respect of that failure, in accordance with paragraphs (2) and (3).

(2) The amount which the CFD counterparty must, by virtue of paragraph (1), pay an electricity supplier who was required to pay a mutualisation amount (“the non-defaulting supplier”) is the amount given by—

where—

• AR is the amount recovered from the defaulting supplier in respect of the failure to make the relevant payment (“the relevant default”), including any interest paid by the defaulting supplier in respect of that failure;

• SU is the mutualisation amount which the non-defaulting supplier was required to pay in respect of the relevant default; and

• AU is the total amount of mutualisation payments which were required to be paid by all non-defaulting suppliers in respect of the relevant default.

(3) Any amount which the CFD counterparty is required to pay by virtue of paragraph (1) must be paid by the 5th working day after the day on which it recovers the amount to be paid.