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P305: Post Implementation Review

BSC Modification P305 was implemented on 5 November 2015, and introduced a number of changes to the calculation of the cash-out price. It was raised to progress the conclusions to Ofgem’s Electricity Balancing Significant Code Review (EBSCR), which looked at addressing the Authority’s concerns with the electricity balancing arrangements.

This 12 month review of P305 is provided by ELEXON to contribute to all interested parties’ understanding of the BSC Modification. The review presents factual information rather than an assessment of the success of the Modification.

Content list of full report

Executive Summary

Background and scope of analysis

  • BSC Modification P305
  • Analysis Provided
  • Market Context
  • Change in Market Participants
  • Related Work

Balancing Behaviour

  • Market balancing as measured by Net Imbalance Volume (NIV)
  • Market balancing as measured by Parties’ aggregated Imbalance
  • Party Imbalances by Long and Short
  • Balancing Production and Consumption Energy Accounts

Overview of Pricing Trends

  • Overview of System Prices since the implementation of BSC Modification P305
  • System Prices since BSC Modification P305 implementation compared to previous years
  • Comparison of System Prices using different price scenarios
  • November 2018 scenario
  • BSC Modification P305 and price volatility
  • Bids and Offers affecting number of extreme System Prices

Overview of Parties Trading Charges

  • Historical Imbalance Trading Charges
  • P217 Price scenario
  • November 2018 Price scenario

Parameter Analysis

  • Reduction in the Price Average Reference Volume (PAR) Value
  • Reduction in the Replacement Price Average Reference Volume (RPAR)
  • De-Rated Margin (DRM), Loss of Load Probability (LoLP) and the Reserve Scarcity Price
  • DRM as an informational tool
  • The impact of including non-BM STOR volumes in the System Price calculation
  • The Buy Price Price Adjuster

List of Appendices

  • Appendix 1: Glossary
  • Appendix 2: Classification of Party Types
  • Appendix 3: Summary of Workshop Views And Evidence Provided