BSC Panel 193 BSC Panel 193 12 January 2012
Report on Progress of Report on Progress of Modification Proposals Adam Richardson 12 January 2012
Modifications Overview New New P281 P281 Definition - P272 P274 P275 P276 P277 P272, P274, P275, P276, P277, Assessment P278, P280, Standing Issue 43 Report Report - With - Authority Authority Authority - Determined Determined Self-Gov P279 Implemented Determined Determined 2
Modifications Overview Progression Mod Title Panel Rec Ofgem Dec Dec By Est Imp IWA Assess Report Authority P266 Reactive Power Oct-10 Feb-11 Mar-11 14-Mar-11 Approve Approved 29-Apr-11 Feb-12 P268 P/C Status export BMU Feb-11 Jul-11 Aug-11 Aug-10 Approve Approved − Feb-12 N/A: P269 BMU Account flipping Mar-11 Jul-11 Aug-11 Approved − − Feb-12 Self-Gov P272 Mandatory HH for PC 5-8 Jun-11 Nov-11 Jan-12 N/A: SVA Funding Share SVA Funding Share P273 Aug-11 - Sept-11 Self-Gov _ Feb-12 Calculation Cessation of Compensatory P274 Oct-11 Mar-12 Adjustments Extending BSC Performance P275 P275 Oct 11 Oct-11 Mar 12 Mar-12 Assurance Trigger/Threshold for P276 Oct-11 Mar-12 suspending market Interconnector BM Units to P277 Oct-11 Mar-12 choose their P/C Status Transmission Losses for P278 Oct-11 Mar-12 Interconnector Users P280 New Measurement Classes Dec-11 Apr-12 P281 Change of BSCCo Board Jan-12 3
Modification P272: Half Hourly Settlement for Profile Classes 5-8 fil Cl 8 Assessment Report Assessment Report Michael Edwards
P272: Background and proposal g p p » Supply Licence requires • All PCs 5-8 customers have HH-capable advanced meter by 6 April 2014 » P272 (proposed by SmartestEnergy) » P272 (proposed by SmartestEnergy) • Require these customers to be settled Half Hourly » Proposed solution undergone industry impact assessment • 22 July – 12 August • Impacts Suppliers, Data Collectors, Meter Operator Agents, S l C ll O Distributors
P272: Process followed » IWA: 09 June 2011 • Terms of Reference agreed » Workgroup met four times » One Impact Assessment » Two Consultations • To get industry views on P272 and confirm impacts • To better quantify the costs and benefits of P272, to help Ofgem inform their recommendation to the BSC Panel
P272: Proposed Solution (1) p ( ) » F om 6 Ap il 2014 NHH settlement not allo ed fo PCs 5 8 » From 6 April 2014, NHH settlement not allowed for PCs 5-8 • Except if advanced meter could not be installed - new PARMS Serial to monitor these new PARMS Serial to monitor these » Suppliers choose how to switch prior to 06 April 2014 • e.g. whether to settle HH on installation, or switch later » Current HH Elective transition » Current HH Elective transition • Current HH Elective customers will not be able to switch back to being settled as NHH (unless they leave Profile Classes 5-8 for Classes 1-4) after the approved implementation date Performance Serial (SP08c) tightened Performance Serial (SP08c) tightened • 99% at R1 (rather than RF)
P272: Proposed Solution (2) p ( ) » Additional decimal places on HH eadings » Additional decimal places on HH readings • Flows J0177, J0021, J0281 • Allow for lower-volume customers Allow for lower volume customers » Profiles frozen for Profile Class 5-8 • Still available for customers without advanced meters, UMS, micro-generation » PARMS Serial SP04 widened to include advanced meters • Profile Class 5-8 metering systems with an Advanced Meter that are being settled on a NHH basis after 06 April 2014 will be included within the scope of PARMS Serial SP04. » New PARMS Serial
P272: Alternative Solution » The G o p de eloped an Alte nati e sol tion » The Group developed an Alternative solution which would delay hich o ld dela the mandating of HH Settlement for Profile Classes 5-8, and the requirements, until 06 April 2015. » Some of the workgroup believed that mandating P272 from the 06 April 2014 would not provide enough time for Suppliers to resolve April 2014 would not provide enough time for Suppliers to resolve a number of complex issues, and that a ‘transitional period’ should be introduced.
P272: Applicable Objectives Proposed Proposed For Against (c) Minority : Majority: The current arrangements allow Increasing the amount of energy Suppliers to settle NHH customers in pp which is settled half hourly will which is settled half hourly will Profile Classes 5 – 8 on a half hourly provide greater cost transparency, basis. Mandating HH Settlement for enable suppliers to offer customers these customers does not improve greater flexibility to manage their g y g competition energy usage, create new customer tariffs and have more accurate billing There are potential benefits for competition in mandating HH i i i d i HH Reduces financial risks and removes settlement for current PC5-8 sites in barriers to new entrants and smaller the longer term, but the total industry Suppliers Suppliers costs would outweigh of mandating it o t o ld o t eigh of m nd ting it from April 2014 the benefits in the Increases competition between agents short term
P272: Applicable Objectives Proposed Proposed For Against (d) Minority: Majority: There would no longer be the Not efficient to put through a solution requirement for load research PC5 requirement for load research PC5 – 8 8 now that doesn’t take into now that doesn t take into sites as profiles would be ‘frozen’ consideration future changes Inaccuracy in settlements would be Inaccuracy in settlements would be Whilst this may lead to an increased Whilst this may lead to an increased reduced and the work and resultant accuracy in settlements it does not do costs of all Parties and Agents it in an efficient way monitoring and managing the monitoring and managing the inaccuracy ELEXON would still be required to perform profile research for other The introduction of a increase in The int od tion of in e e in p ofile l profile classes, the very marginal e the e m gin l performance completeness to 99% at benefit that will come from not R1 would bring significant increases in undertaking the activity for PC 5-8 is efficiency particularly for billing and efficiency, particularly for billing and immaterial versus the costs of making immaterial versus the costs of making invoice reconciliation the change
P272: Consultation responses p » The recurring theme throughout the responses was the cost of the Proposed Modification against the benefits » No new arguments for or against P272 were identified » 5 Alternatives suggested; workgroup didn’t support these » No unintended effects identified » No unintended effects identified Yes No Other Applicable BSC Objectives facilitated A li bl BSC Obj ti f ilit t d 11 11 6 6 1 1 Further examples of customer 6 12 0 impact Do you think another alternative 5 12 1 solution would better meet the BSC Objectives
P272: Impacts and Costs p » Supplier concerns » Supplier concerns • Customer impact (e.g. higher costs) • Supplier Agent contractual issues • DUoS differential between HH and NHH » NHH Agents NHH A • Need to re-qualify (or Suppliers will need to change agents) » Distributors • Issues with IT system scalability and timescales
P272: Impacts and Costs p » Customers » Customers – concerns concerns • Costs • Contracts » Meters • Communication upgrades to support higher data volumes C i i d hi h d l » Impacts » Impacts • Costs and timings higher than previously identified
P272: Impacts and Costs p Type of Party Initial (£) Ongoing (£) Meter Administrator Meter Administrator 0 0 0 0 HHDC, HHDA, 0 – 500k 0 NHHDC, NHHDA and MOP (HH and and MOP (HH and NHH) NNHDC,NHHDA and Several millions unknown Mop Distributor 5 – 200k 0 – 250k Supplier Supplier 0 – 10 million 0 10 million 250k – 8 million 250k 8 million * These are costs are per party
P272: Modification Group views p » P272 Workgroup recommends P272 proceed to Report Phase » P272 should not be made » Recommended implementation Date: » Recommended implementation Date: • 06 April 2014 » Draft legal text provided for Proposed Modification
Recommendations » NOTE P272 Workgroup’s recommendations O o g oup s eco e da o s » AGREE an initial recommendation that Proposed Modification P272 should not be made; » AGREE an initial recommendation that the Alternative Modification AGREE i iti l d ti th t th Alt ti M difi ti P272 should not be made; » AGREE the draft legal text; g ; » AGREE that Modification Proposal P272 be submitted to the Report Phase; and » AGREE that ELEXON should issue P272 draft Modification Report AGREE th t ELEXON h ld i P272 d ft M difi ti R t for consultation and submit results to the Panel to consider at its meeting on 08 March 2012.
Modification P272: Half Hourly Settlement for Profile Classes 5-8 fil Cl 8 Assessment Report Assessment Report Michael Edwards
P272: Background and proposal g p p » Supply Licence requires • All PCs 5-8 customers have HH-capable advanced meter by 6 April 2014 » P272 (proposed by SmartestEnergy) » P272 (proposed by SmartestEnergy) • Require these customers to be settled Half Hourly » Proposed solution undergone industry impact assessment • 22 July – 12 August • Impacts Suppliers, Data Collectors, Meter Operator Agents, S l C ll O Distributors
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