Market-wide Half Hourly Settlement (MHHS) Working Groups
In July 2017, Ofgem launched its Significant Code Review (SCR) on Electricity Settlement Reform.
Here you can find the outputs of three industry working groups which ELEXON is chairing and providing with technical leadership to support Ofgem’s SCR. All three groups report to Ofgem and Ofgem sets their membership and Terms of Reference.
- Design Working Group (DWG): The DWG ran from 2017 to 2019 and is now closed down. It designed the Target Operating Model (TOM) for MHHS, as well as the approach for transitioning from the current Settlement arrangements to the TOM. We submitted the DWG’s final report to Ofgem in August 2019. Ofgem gave its preliminary approval to the DWG’s TOM and transition approach in October 2019.
- Code Change and Development Group (CCDG): The CCDG will run from December 2019 to mid-2021. It will develop further detailed areas of the DWG’s TOM design. It will also identify, and oversee drafting of, the changes needed to Industry Codes and subsidiary documents to enable the TOM.
- Architecture Working Group (AWG): The AWG will run from December 2019 for 12 months. It will develop and recommend solutions for the system architecture design required to enable the DWG’s TOM.
We will continue to update the CCDG and AWG pages with the latest meeting papers, outputs and consultations. We look forward to engaging with the groups and wider industry on this next phase of work.
How do these groups fit into Ofgem’s SCR process?
Development of the TOM forms one of several work streams in Ofgem’s wider SCR. Ofgem’s other parallel SCR work streams include:
- Related policy decisions (on access to Half Hourly data for Settlement purposes and on Supplier Agent functions)
- Consideration of consumer impacts
- Development of the business case for MHHS (including a recent Request for Information to gather information on participants’ impacts, costs and timescales)
Ofgem will bring the outputs of all the SCR work streams together in Q3 2020, when it intends to make its Full Business Case decision on how and when to proceed with MHHS. Ofgem will make the final decision on the TOM and transition approach.
Following the CCDG’s final report, Ofgem will also make the necessary changes to licences and Industry Codes, which will therefore not follow the normal Code change processes.
What are the potential benefits of MHHS?
Smart Meters can record the amount of energy consumed or exported within every half hour of the day.
Through MHHS, this data provides an opportunity to make the BSC Settlement process more accurate and timely. It also helps facilitate a smarter energy system by encouraging more dynamic and flexible ‘time of use’ energy deals, where consumers save money if they shift their energy usage away from times of peak demand.
You can find more information on Ofgem’s view of the potential benefits in its business case publications.