If you work in UK power, you've probably heard "P442" mentioned quite a bit lately.

Partners want to explain it clearly to clients. Business customers want to know if the savings are real, and how to compare different offers. So we’ve pulled together this essential guide to help you stay ahead of this huge industry change.

The savings are real. What matters most is how a scheme is set up and run, and how clearly the benefit shows up on your bill.

What Exempt Supply does

Exempt Supply is a regulatory scheme that connects eligible renewable generation (like solar or wind farms) to eligible business customer electricity use.

When set up correctly, it removes some Non-Commodity Costs (NCCs) from the matched portion of your electricity.

That's where your bill savings come from.

What P442 changed

Exempt Supply has been around for years, but it used to be slow and difficult to run at scale. tem saw this firsthand - we were the first to bring Exempt Supply to a scale-ready level, offering it as an extra benefit to existing RED customers in 2024/2025 and processing over 70 applications, more than anyone had ever attempted in one go. You can read more about that in our older blog here.

In late 2025, P442 was introduced as the framework and infrastructure to make it work properly:

• An ESNA process for independent verification

• Central tracking of exempt volumes

• Clear operating rules, including a 2.5 MWh cap per 30-minute settlement period

In short: P442 makes Exempt Supply something you can run reliably, rather than a manual, one-off workaround. It's a win for the scheme, but it also shows how much work the industry still needs to do to make cost reductions accessible at scale.

A simple way to picture it: pizza

The easiest way to think about this is pizza.

The generator makes the pizza. The pizza itself is the renewable energy. The businesses are sitting around sharing it.

The scheme is the plan for how the slices get shared: who gets what slice, and how much. Each business in the scheme gets a portion of the renewable power, and the savings and earnings linked to that portion.

Questions to ask when comparing offers

These questions will tell you more than any headline percentage saving. Ask your supplier or broker:

1. Am I eligible, and what are you basing that on? Eligibility depends on your site and customer type. Ask what's been checked.

2. What exactly gets removed, and how will I see it? Ask for a worked example showing which NCC categories are removed and the £/MWh impact. (P442 typically saves a single-digit percentage of your total bill, though it varies by customer.)

3. Who is the ESNA and what are they verifying? There should be an official ESNA process involved.

4. What happens when things change? Ask how the scheme stays compliant when:

   • Generation output changes

   • Your demand changes

   • Sites join or leave

If the answer is vague, that's a red flag.

1. What visibility will I have over time? You should be able to see matched volumes, how close you are to the cap, and what changes month to month. If you can't see how the scheme is performing, ask for it.

Why this matters now for partners

Two suppliers can both say they "offer P442" but deliver very different results:

• Different eligibility checks and assumptions

• Different ability to keep schemes compliant over time

• Different levels of transparency on invoices and reporting

If you want to help a client choose well, focus less on the headline claim and more on getting clear answers to the questions above.