P284 – Expansion of Elexon’s role via the ‘contract model’
Formal title: Expansion of Elexon’s role via the ‘contract model’
The current BSC provisions do not allow BSCCo (Elexon) to perform anything other than the activities specified in the BSC. As part of a recent Ofgem consultation on Elexon diversification, Ofgem concluded that if Elexon were to undertake a wider role, a ‘contract model’ (whereby ‘New Elexon’ would be contracted to BSCCo) would best protect BSC Parties’ interests.
P284 seeks to place provisions in the BSC to enable, but not require, the BSCCo Board to establish a BSC services contract with ‘New Elexon’ subject to specified steps having been undertaken.
P284 was raised by National Grid on 17 May 2012.
Although the Proposer is not recommending urgency for P284, they note Elexon’s desire to participate in the licence bid process for the Data and Communications Company (DCC). The Proposer considers that the necessary ‘enabling’ changes to the BSC may therefore require timely development and implementation to align with the Government’s bid timetable.
Elexon, as BSCCo, has the ability to independently recommend urgency under BSC Section F2.9. Given the DCC bid timetable, we have recommended that P284 is progressed as an Urgent Modification Proposal. You can find our rationale for this recommendation in the P284 Initial Written Assessment (IWA) below.
The BSC Panel met on 28 May 2012 to consider P284. Panel Members were split on whether P284 should be progressed as an Urgent Modification Proposal, with equal numbers for and against. The Panel Secretary has written to Ofgem setting out the Panel’s views, and seeking Ofgem’s instruction as to whether P284 should be treated as an Urgent Modification Proposal. You can find a copy of this letter below.
In the event that Ofgem does grant urgency, the Panel recommends that P284 follows the urgent progression process and timetable set out on page 8 of the IWA and page 3 of the letter. In the event that urgency is not granted, the Panel has determined that P284 should undergo an expedited Assessment Procedure and Report Phase as described on page 8 of the IWA.
The Workgroup issued their Assessment Procedure Consultation on 8 June 2012, with responses due by 29 June 2012. The Workgroup met on 4 July 2012 to consider the responses to the Assessment Consultation. The Workgroup recommended rejection of both Proposed and Alternative Modifications as it was unsure if any benefits would be realised for BSC Parties.
The Workgroup’s Assessment Report was presented to the Panel at its meeting on 12 July 2012, where the majority of the BSC Panel agreed with the majority view of the P284 Workgroup. Further details of both the Panel and Workgroup debate can be found in the Draft Modification Report below.
P284 was issued for the Panel’s Report Phase Consultation and the Panel made its final recommendation to reject both the P284 Proposed and Alternative Solutions at its meeting on 9 August 2012.
On 17 September 2012 the Authority approved the P284 Alternative Modification for implementation on 18 September 2012.