Energy Theft is a significant contributor to Settlement inaccuracies, directly linked to 018 SVA Risk: ‘Revenue Protection volumes are not settled Risk 18’ . The failure to correctly account for energy theft in Settlement can lead to erroneous or estimated data entering Settlement. It is estimated that the financial impact of unaddressed energy theft exceeds £1 billion annually creating substantial risks for both Suppliers and the wider industry.
The following areas contribute to the inaccurate recording of Settlement Post-Theft:
- Inadequate reporting: Evidence of tampering is not consistently reported on or documented correctly.
- Incorrect Adjustments: There are failures in recording meter advance adjustments, recalculating meter advances, as well as making accurate estimates, as required by Revenue Protection Services.
- Lack of Industry Awareness: A limited understanding of the Distribution Connection and Use of System Agreement (DCUSA), Balancing and Settlement Code (BSC) and UK Revenue Protection Association (UKRPA) frameworks lead to inconsistent applications of theft resolutions procedures.
- Insufficient Settlement Correction Mechanisms: The current process does not facilitate proactive resolution of Settlements post-theft, which discourages Suppliers from addressing discrepancies.
By improving the alignment between the processes used to track and address energy theft (Revenue Protection) and the Settlement Correction mechanism, the industry can be better incentivised to accurately report and rectify Theft-Related energy discrepancies. Strengthening these measures will support compliance.