Design Working Group

The DWG supports Ofgem in the ELEXON-led project to design and assess the Target Operating Model (TOM) for Market-wide Half Hourly Settlement (MHHS). The TOM is a key output of Ofgem’s Significant Code Review (SCR) on Electricity Settlement Reform.

What’s new?

DWG’s consultation reconfirms its transition approach

Thank you to everyone who responded to the DWG’s consultation on its approach for transitioning from the current Settlement arrangements to the TOM. Click here to read the public consultation responses.

The DWG discussed the responses at its meeting on 17 July 2019. Overall, the DWG agrees that the responses:

  • Positively affirm its approach to the TOM transition
  • Require no changes to its transition approach, transition principles and Performance Assurance Framework assumptions/principles, only some clarifications and presentational changes 
  • Highlight that, while there is no consensus on whether the elective Half Hourly Settlement (HHS) process should be a formal stepping stone to the TOM under the SCR, any possible improvements to the elective HHS process should be considered and progressed through the existing BSC change process
  • Raise a variety of non-Settlement points for consideration by Ofgem under its wider SCR
  • Raise a variety of useful Settlement questions and points for consideration when developing the more
    detailed TOM design and transition plan

You can find a more detailed summary of the DWG’s discussions in its Meeting 19 Headline Report.

About the DWG’s work

The DWG has developed the TOM in two stages:

Stage 1:

This stage is complete. It involved the DWG’s development and asessment of a set of ‘skeleton’ TOMs. The output was a report to Ofgem on 4 April 2018, setting out the five skeleton TOMs to be taken forward for industry consultation. The consultation was issued on 30 April 2018 and closed on 29 May 2018. Click here to read the collated consultation responses.

The responses showed all five TOMs to be viable options and that the DWG had not missed any other TOM or significant aspects of design. They showed no consensus on an overall preferred TOM. The DWG therefore took all of the TOMs forward for further design and evaluation in Stage 2.

Stage 2:

This stage is nearing completion. It comprises development of both the final high-level TOM design and a high-level transition approach.

TOM design

Between April 2018 and January 2019, the DWG developed high-level service requirements for the TOMs, evaluated the different TOMs and delivered a single preferred TOM to Ofgem. On 15 February 2019, Ofgem published the DWG’s report on its preferred TOM for MHHS.

You can also find supporting information to the DWG’s TOM report here. This contains the contents of the report’s Attachment A, but separated out by the individual services within the TOM. 

The DWG consulted on its report from 18 February 2019 to 15 March 2019. Click here to read the public consultation responses. The responses validated the overall approach and coverage of the TOM design, and resulted in no fundamental changes to the TOM.

Transition approach

From January to May 2019, the DWG developed its high-level approach for transitioning from the current Settlement arrangements to the TOM. It consulted on this from 7 June to 8 July 2019. The responses validated the DWG’s transition approach, resulting in some minor clarifications but no changes to the approach itself (see ‘What’s new?’ above).

Final report

The DWG is now drafting its final Stage 2 report to Ofgem, for submission at the end of August 2019. This will conclude the DWG’s work under its Terms of Reference. We will publish the report on this page once finalised.

You can view the DWG’s latest Gantt chart plan under ‘Related Content’ on the right-hand side of this page.

How the DWG fits into Ofgem’s SCR process

The DWG’s outputs form one of several work streams in Ofgem’s wider SCR. The DWG makes recommendations for Ofgem’s approval. Ofgem will make the final decision on the TOM and transition approach.

Ofgem’s other parallel SCR work streams include:

Ofgem will bring the outputs of all the SCR work streams together in its Full Business Case decision on how and when to proceed with MHHS.

ELEXON chairs the DWG and Ofgem appoints its members. Ofgem is not a member but attends as an observor and provides strategic input where necessary.

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