NESO - Final Recommendations of TM04+

The Gate 2 Criteria Methodology is in two parts:

Part 1: The Gate 2 "Readiness Criteria" - through a Readiness Declaration, a User will be required to provide evidence that their project is 'ready' by showing that it meets the Gate 2 Readiness Criteria:

LAND:

• meet Minimum acreage requirements. This will be calculated using the Energy Land Density Table¹ as defined under CMP427. Examples include:
  
  

  Plant Type	Minimum acres per MW registered
  Demand	0.0870
  Energy Storage	0.0151
  PV Array	2.0
  Wind Onshore	7.6829



• provision of original red line boundary (as set out in Section 17 CUSC); and
• secured land rights, either:
  • option agreement which must have a minimum 3 year period from the date the option is signed. The accompanying lease must be a minimum 20 years from the date of exercise of the option; or
  • evidence of existing ownership at the time of submission of the Gate 2 evidence; or
  • existing land lease with a remaining term of minimum of 20 years.

There are some exemptions to be above requirements, for example there is no minimum length for the land option required if the option is entered into by the User before the Authority Decision Date on CMP435. Also, under CMP435, projects that have met Queue Management Milestone M1 (including Distribution Queue Management Milestone M1) and/or progressed beyond Queue Management Milestone M1 will also not need to meet the minimum option length requirements.

PLANNING: submission of application for planning consent for projects following the Development Consent Order (DCO) process. The evidence requirement is the submission of application for planning consent for projects following the DCO process or, in exceptional circumstances, other planning consent routes.

Part 2: The Gate 2 "Strategic Alignment Criteria" – Users will then need to meet one of the following Gate 2 Strategic Alignment Criteria:

a. Eligible for relevant ‘protections’; this is a new element NESO have introduced

• Protection Clause 1: Projects contracted to connect by the end of 2026 (CMP435): these projects will retain a place in the reformed queue and will also retain their existing contracted connection date and connection location. These projects will contribute towards the relevant CP30 Action Plan zonal capacity total. This applies to any existing agreement where the User can evidence the following prior to the closure of the CMP435 Gated Application Window:
  1. having a contracted connection date of 31 December 2026 or earlier; and
  2. having met both Queue Management Milestone M2 and Queue Management Milestone M7.

• Protection Clause 2a: Projects which are significantly progressed (CMP435): any project that meets the following conditions will be deemed to have met the Gate 2 Strategic Alignment Criteria. These projects will retain a place in the reformed queue, even if the project exceeds the zonal or GB permitted capacity for its technology type (as set out within the CP30 Action Plan). This clause does not protect the existing connection date; these projects will still be reordered as shown in Section 5 of the Connections Network Design Methodology (CNDM) and reassessed for advancement where this is requested. This clause applies to any existing agreement where the User can evidence one of the following prior to the closure of the CMP435 Gated Application Window:
  1. having obtained planning where the relevant planning application was submitted on or before 20 December 2024;
  2. holding a Contract for Difference;
  3. holding a Capacity Market contract; or
  4. (for interconnector or offshore hybrid asset projects only) having obtained regulatory approval from the Authority, in the form of either a Cap and Floor agreement or Merchant Interconnector approval.

• Protection Clause 2b: Projects which are significantly progressed (those who reapply in CMP434 only): any project that meets the following conditions will be deemed to have met the Gate 2 Strategic Alignment Criteria. This clause guarantees a place in the CMP434 queue, even if the project exceeds the zonal or GB permitted capacity for its technology type (as set out within the CP30 Action Plan). This clause applies to any application where the User can demonstrate one of the following prior to the closure of the CMP434 Gated Application Window:
  1. holding a Contract for Difference;
  2. holding a Capacity Market contract; or
  3. (for interconnector or offshore hybrid asset projects only) having obtained regulatory approval from the Authority, in the form of either a Cap and Floor agreement or Merchant Interconnector approval (via the relevant exemptions process with the Authority).

• Protection Clause 3: Projects which obtain planning consent after closure of the CMP435 Gated Application Window (those who reapply in CMP434 only): This clause applies to projects where the User has submitted an application for planning prior to the closure of the CMP435 Gated Application Window and has not obtained this planning before the closure of the CMP435 Gated Application Window. The project will only be required to adhere to the GB total permitted capacity (as set out within the CP30 Action Plan) for the relevant technology. Where there is a zonal permitted capacity outlined for the technology, and this is exceeded, the project will still receive a Gate 2 offer provided it does not exceed the GB total permitted capacity.

New applications to Gate 2 in CMP434 that are not associated with previous existing agreements will not be in scope of these protections. If a User has only obtained planning or secured a government support contract for part of a project, then only that part will benefit from protection outlined above.

b. Aligned to the capacities within the CP30 Action Plan. The following technologies are in and out of scope of CP30 Action Plan:

In scope technologies will be assessed against the 2030 and 2035 capacity ranges as outlined in Section 5.7 of the CNDM before they can be deemed to have met the Gate 2 Strategic Alignment Criteria. Technologies that are listed in this table and are not in scope of the CP30 Action Plan will automatically meet the Gate 2 Strategic Alignment Criteria. Any technologies not listed in this table will only be able to meet the Gate 2 Strategic Alignment Criteria by meeting Strategic Alignment Criteria (c) or (d).

For technologies with one GB-wide zone and technologies with no distinction between transmission and distribution capacities, NESO will align the combined transmission and distribution queue to the CP30 Action Plan and determine which projects meet the Gate 2 Strategic Alignment Criteria. For technologies with zonal breakdowns at transmission and distribution, NESO will align the transmission queue to the CP30 Action Plan and DNOs will provisionally align their distribution queues to the CP30 Action Plan.

c. Designated as described in the Project Designation Methodology:

• projects that are critical to security of supply: NESO will publish a notice in respect of projects needed in these categories.
• projects that are critical to system operation: NESO will publish a notice in respect of projects needed in these categories.
• projects that materially reduce system and/or network constraints: NESO will publish a notice in respect of projects needed in these categories.
• projects that are new technologies, that are not included in the CP30 Plan or do not correspond with a technology that has been deemed by NESO to have met the strategic alignment criteria: Users can make designation applications at any point (i.e. not requiring a Notice from NESO). NESO will assess projects against a criterion. The following types of project can seek designation under category D: (i) Those that do not correspond with a technology that has been specified within Government’s CP30 Action Plan or do not correspond with a technology out of scope of the CP30 Action Plan that has been deemed by NESO to have met the strategic alignment criteria; and/or (ii) are within a technology, (e.g. ‘solar’ or ‘nuclear’) that has been specified within Government’s CP30 Action Plan but is a novel sub-type which has been successfully developed and demonstrated, is considered commercially viable and would provide benefits for GB consumers.
• projects with very long lead times: Users can make designation applications at any point (i.e. not requiring a Notice from NESO). NESO will assess projects against a criterion.

d. A project not within scope of the CP30 Action Plan and of a technology type listed in the table above.

There are also ongoing compliance requirements.

Transmission connected demand and other ‘out of scope’ technologies (listed in the table above) that have met the Gate 2 Readiness Criteria will be deemed to have met the Gate 2 Strategic Alignment Criteria. These projects will be sorted into Phase 1 or Phase 2 depending on their contracted connection date or requested advancement date. The MW volume of these projects in each phase will not however be bound by a ‘permitted capacity’ as is the case for projects in scope of the CP30 Action Plan.

The Gate 2 Readiness Criteria will be applied to the existing queue as follows:

1. projects which have met the Gate 2 Readiness Criteria will be identified;
2. projects that are selected for the Gate 1 connection point and capacity reservation will be identified, these are projects which have not met the Gate 2 Readiness Criteria but are selected for Connection Point and Capacity Reservation;
3. remaining projects that have not been identified will be removed from the queue; and
4. projects which have been identified will be 'bunched up' to form the new queue.

From this point, the projects which meet the Gate 2 Strategic Alignment Criteria can be determined.

The following process will be used to align the queue to the CP30 Action Plan:

1. a sub-queue will be formed for each technology in each zone;
2. projects which are eligible for 'protections' will be identified and assigned to a phase based on their contracted connection date, or advancement date where requested;
3. the planning status of the remaining projects will be determined and used to order them;
4. the relevant TO/DNO will identify any network limitations preventing advancement (prior to a detailed network study);
5. where remaining projects have an existing or requested date of 2030 or earlier, they will be added to Phase 1 until the permitted capacity is reached;
6. the remaining projects will be added to Phase 2 until the permitted capacity is reached. Any projects exceeding this will not receive a Gate 2 offer; and
7. Phase 1 projects will be returned to their existing relative queue positions and Phase 1 and Phase 2 will be recombined.³

Due to the protections NESO has provided for existing projects, there may be cases where permitted capacities for 2030 or 2035 are exceeded in some zones. Where possible, NESO will adjust or ‘rebalance’ the zonal capacities to maintain alignment to the GB-wide total permitted capacities. This rebalancing does not require a change to the connection location of any associated project(s). Rather, the permitted capacity would be increased to accommodate the additional project(s) in one zone and another zone’s permitted capacity would be decreased to ensure alignment to the overall GB permitted capacity is maintained.

Assessments will also be undertaken at Grid Supply Points (GSP) to determine any further local or GSP works required to connect relevant embedded projects. These assessments will enable TOs to identify requirements, for example, new Super Grid Transformers or any requirements to resize those previously proposed.

The relevant TO will identify scenarios where a GSP may require reassessment. NESO expect TOs to prioritise the following scenarios when determining which GSPs require reassessment as part of the Gate 2 to Whole Queue exercise:

1. Where a high percentage of projects previously contracted to connect at the GSP have been removed from the queue following the application of the Gate 2 Criteria;
2. Where a high number of Project Progressions are associated with a single GSP; or
3. Where works associated with new SGT(s) have been triggered.

Technical Limits will continue to be used to facilitate the connection of relevant embedded generation before transmission reinforcement works have been completed. In areas where Technical Limits are not currently in place, other design variations will be explored to facilitate earlier connections under temporary restrictions to availability.

If a Phase 1 project cannot be connected in 2030 or earlier under a firm (or enduring non-firm) connection, it will be assessed against the Technical Limits for 2030 and connected earlier under temporary restrictions to availability where possible. Where Phase 2 projects have requested to connect before 2030, these projects will be assessed against the Technical Limits for 2030 and connected earlier under temporary restrictions to availability where possible. These projects will remain aligned to the 2035 permitted capacity for the purposes of queue position and the date of their full connection. Their earlier connection date under temporary restrictions will not result in them being counted towards the 2030 permitted capacity. Projects which do not align with the 2030 or 2035 permitted capacities will not be permitted to connect under Technical Limits.