P_ij must be calculated in accordance with the formula—

$P_{ij}=\left(\frac{S{P}_i}{MaxS{P}_i}\right)\times \min \left(MaxS{P}_i,MP{C}_{ij}\right)$.

Q_ij must be calculated in accordance with the formula—

${\text{Q}}_{\text{ij}}=AP{C}_{ij}-{\displaystyle \sum _{k=1}^{m-1}MPS{A}_{ik}}$

and where that calculation would give a negative number, the value of Q_ij is to be taken to be zero.

For the purposes of the calculation in sub-paragraph (5), APC_ij is the annual penalty cap in pounds applying to CMU i in respect of relevant settlement period j, and is to be calculated in accordance with the formula—

$AP{C}_{ij}=AC{P}_{ix}\times G_i+{\displaystyle {\sum }_N\left(tAC{P}_N\times G_z\times W{F}_{mx}\times \frac{D{T}_{mN}}{D_m}\right)}$,

where “DT_mN” and “D_m” have the meanings given in paragraph 3(3A)

In this paragraph—

• F1...

• F2“ACP_ix” means the amount of annual capacity payments calculated under paragraph 3 for CMU i in respect of year X;

• F8“F_y” (for any value y) means the percentage stated on the capacity market register under regulation 31(2)(f), at the date of issue of the capacity agreement, as the monthly penalty cap percentage for the capacity obligation CO_yx awarded in respect of CMU y for year X;

• “G_y” (for any value y) means the percentage stated on the capacity market register under regulation 31(2)(f), at the date of issue of the capacity agreement, as the annual penalty cap percentage for the capacity obligation CO_yx awarded in respect of CMU y for year X;

• “$MaxS{P}_i$” is the sum in pounds of all settlement period penalties which would have applied to CMU i in respect of relevant settlement periods in month M, as calculated in accordance with paragraph 5 F9up to and including the settlement period for which the calculation is being made, if $A{E}_{ij}$ had been 0 for all such settlement periods;
• “$MC{P}_{im}$” means the amount of the monthly capacity payment calculated under paragraph 3 for CMU i and month M;

• F11“${\displaystyle \sum _{k=1}^{m-1}MPS{A}_{ik}}$”

  means the sum of the monthly penalty charges paid or payable in respect of CMU i for each of the months of year X preceding month M (or where M is the first such month, zero); and

• “relevant CMU” has the same meaning as in paragraph 5;

• “$S{P}_i$” is the sum of all settlement period penalties applying to CMU i in respect of relevant settlement periods in month M, as calculated in accordance with paragraph 5 F9up to and including the settlement period for which the calculation is being made;

• F10...

• F12“tACP_N” has the meaning given in paragraph 3(3A)