diff --git a/specs/merge/beacon-chain.md b/specs/merge/beacon-chain.md
index 01c54e017..1a9c933d6 100644
--- a/specs/merge/beacon-chain.md
+++ b/specs/merge/beacon-chain.md
@@ -59,6 +59,10 @@ This patch adds transaction execution to the beacon chain as part of the Merge f
 | `MAX_BYTES_PER_OPAQUE_TRANSACTION` | `uint64(2**20)` (= 1,048,576) |
 | `MAX_TRANSACTIONS_PER_PAYLOAD` | `uint64(2**14)` (= 16,384) |
 | `BYTES_PER_LOGS_BLOOM` | `uint64(2**8)` (= 256) |
+| `GAS_LIMIT_DIVISOR` | `uint64(2**10)` (= 1,024) |
+| `MIN_GAS_LIMIT` | `uint64(5000)` (= 5,000) |
+| `BASE_FEE_MAX_CHANGE_DENOMINATOR` | `uint64(2**3)` (= 8) |
+| `ELASTICITY_MULTIPLIER` | `uint64(2**1)` (= 2) |
 
 ## Containers
 
@@ -141,6 +145,7 @@ class ExecutionPayload(Container):
     gas_limit: uint64
     gas_used: uint64
     timestamp: uint64
+    base_fee_per_gas: uint64  # base fee introduced in eip-1559
     # Extra payload fields
     block_hash: Hash32  # Hash of execution block
     transactions: List[Transaction, MAX_TRANSACTIONS_PER_PAYLOAD]
@@ -161,6 +166,7 @@ class ExecutionPayloadHeader(Container):
     gas_limit: uint64
     gas_used: uint64
     timestamp: uint64
+    base_fee_per_gas: uint64
     # Extra payload fields
     block_hash: Hash32  # Hash of execution block
     transactions_root: Root
@@ -239,6 +245,51 @@ def process_block(state: BeaconState, block: BeaconBlock) -> None:
 
 ### Execution payload processing
 
+#### `is_valid_gas_limit`
+
+```python
+def is_valid_gas_limit(payload: ExecutionPayload, parent: ExecutionPayloadHeader) -> bool:
+    parent_gas_limit = parent.gas_limit
+
+    # check if the payload used too much gas
+    if payload.gas_used > payload.gas_limit:
+        return False
+
+    # check if the payload changed the gas limit too much
+    if payload.gas_limit >= parent_gas_limit + parent_gas_limit // GAS_LIMIT_DIVISOR:
+        return False
+    if payload.gas_limit <= parent_gas_limit - parent_gas_limit // GAS_LIMIT_DIVISOR:
+        return False
+
+    # check if the gas limit is at least the minimum gas limit
+    if payload.gas_limit < MIN_GAS_LIMIT:
+        return False
+
+    return True
+```
+
+#### `compute_base_fee_per_gas`
+
+```python
+def compute_base_fee_per_gas(payload: ExecutionPayload, parent: ExecutionPayloadHeader) -> uint64:
+    parent_gas_target = parent.gas_limit // ELASTICITY_MULTIPLIER
+    parent_base_fee_per_gas = parent.base_fee_per_gas
+    parent_gas_used = payload.gas_used
+
+    if parent_gas_used == parent_gas_target:
+        return parent_base_fee_per_gas
+    elif parent_gas_used > parent_gas_target:
+        gas_used_delta = parent_gas_used - parent_gas_target
+        base_fee_per_gas_delta = \
+            max(parent_base_fee_per_gas * gas_used_delta // parent_gas_target // BASE_FEE_MAX_CHANGE_DENOMINATOR, 1)
+        return parent_base_fee_per_gas + base_fee_per_gas_delta
+    else:
+        gas_used_delta = parent_gas_target - parent_gas_used
+        base_fee_per_gas_delta = \
+            parent_base_fee_per_gas * gas_used_delta // parent_gas_target // BASE_FEE_MAX_CHANGE_DENOMINATOR
+        return max(parent_base_fee_per_gas - base_fee_per_gas_delta, 0)
+```
+
 #### `process_execution_payload`
 
 *Note:* This function depends on `process_randao` function call as it retrieves the most recent randao mix from the `state`. Implementations that are considering parallel processing of execution payload with respect to beacon chain state transition function should work around this dependency.
@@ -250,6 +301,8 @@ def process_execution_payload(state: BeaconState, payload: ExecutionPayload, exe
         assert payload.parent_hash == state.latest_execution_payload_header.block_hash
         assert payload.block_number == state.latest_execution_payload_header.block_number + uint64(1)
         assert payload.random == get_randao_mix(state, get_current_epoch(state))
+        assert payload.base_fee_per_gas == compute_base_fee_per_gas(payload, state.latest_execution_payload_header)
+        assert is_valid_gas_limit(payload, state.latest_execution_payload_header)
     # Verify timestamp
     assert payload.timestamp == compute_timestamp_at_slot(state, state.slot)
     # Verify the execution payload is valid
@@ -266,6 +319,7 @@ def process_execution_payload(state: BeaconState, payload: ExecutionPayload, exe
         gas_limit=payload.gas_limit,
         gas_used=payload.gas_used,
         timestamp=payload.timestamp,
+        base_fee_per_gas=payload.base_fee_per_gas,
         block_hash=payload.block_hash,
         transactions_root=hash_tree_root(payload.transactions),
     )
@@ -321,6 +375,7 @@ def initialize_beacon_state_from_eth1(eth1_block_hash: Bytes32,
     state.latest_execution_payload_header.block_hash = eth1_block_hash
     state.latest_execution_payload_header.timestamp = eth1_timestamp
     state.latest_execution_payload_header.random = eth1_block_hash
+    state.latest_execution_payload_header.gas_limit = MIN_GAS_LIMIT
 
     return state
 ```
diff --git a/tests/core/pyspec/eth2spec/test/helpers/execution_payload.py b/tests/core/pyspec/eth2spec/test/helpers/execution_payload.py
index c41a05079..5c7eb6de0 100644
--- a/tests/core/pyspec/eth2spec/test/helpers/execution_payload.py
+++ b/tests/core/pyspec/eth2spec/test/helpers/execution_payload.py
@@ -17,12 +17,14 @@ def build_empty_execution_payload(spec, state, randao_mix=None):
         logs_bloom=spec.ByteVector[spec.BYTES_PER_LOGS_BLOOM](),  # TODO: zeroed logs bloom for empty logs ok?
         block_number=latest.block_number + 1,
         random=randao_mix,
-        gas_limit=latest.gas_limit,  # retain same limit
+        gas_limit=max(latest.gas_limit, spec.MIN_GAS_LIMIT),
         gas_used=0,  # empty block, 0 gas
         timestamp=timestamp,
+        base_fee_per_gas=spec.uint64(0),
         block_hash=spec.Hash32(),
         transactions=empty_txs,
     )
+    payload.base_fee_per_gas = spec.compute_base_fee_per_gas(latest, payload)
     # TODO: real RLP + block hash logic would be nice, requires RLP and keccak256 dependency however.
     payload.block_hash = spec.Hash32(spec.hash(payload.hash_tree_root() + b"FAKE RLP HASH"))
 
@@ -41,6 +43,7 @@ def get_execution_payload_header(spec, execution_payload):
         gas_limit=execution_payload.gas_limit,
         gas_used=execution_payload.gas_used,
         timestamp=execution_payload.timestamp,
+        base_fee_per_gas=execution_payload.base_fee_per_gas,
         block_hash=execution_payload.block_hash,
         transactions_root=spec.hash_tree_root(execution_payload.transactions)
     )
diff --git a/tests/core/pyspec/eth2spec/test/helpers/genesis.py b/tests/core/pyspec/eth2spec/test/helpers/genesis.py
index a9eb59f67..fc14c0aef 100644
--- a/tests/core/pyspec/eth2spec/test/helpers/genesis.py
+++ b/tests/core/pyspec/eth2spec/test/helpers/genesis.py
@@ -78,5 +78,6 @@ def create_genesis_state(spec, validator_balances, activation_threshold):
         # Initialize the execution payload header (with block number and genesis time set to 0)
         state.latest_execution_payload_header.block_hash = eth1_block_hash
         state.latest_execution_payload_header.random = eth1_block_hash
+        state.latest_execution_payload_header.gas_limit = spec.MIN_GAS_LIMIT
 
     return state