P366 Change to Supplier Charge SP08a for hard-to-read sites
Formal title: Change to Supplier Charge SP08a calculations to account for small scale non-domestic Non Half Hourly hard-to-read Meters
P366 will amend how Supplier Charge SP08a is applied to Non Half Hourly non-domestic Meters that are hard-to-read (HTR). This will be achieved in two parts. Firstly, P366 will create a process to identify and approve HTR sites. Secondly, P366 will create a process whereby HTR sites, identified at Metering System Identification (MSID) level, will be excluded from SP08a calculations. Only SP08a Supplier Charges will be affected. HTR sites will still be included in all other Settlement and PARMS calculations, where relevant. P366 will not affect the management of Settlement Risk.
The BSC requires that, in relation to each GSP Group, the percentage of total energy attributable to a Supplier, in respect of Non Half Hourly (NHH) Metering Systems, settled on the basis of Annualised Advances (AA) for each Settlement Day shall be not less than 80% for the Third Reconciliation (R3) Volume Allocation Run (VAR) and 97% for the Final Reconciliation (RF) VAR. Any underperformance against these targets is subject to a Supplier Charge. This is monitored and reported in the Performance Assurance Reporting and Monitoring System (PARMS) as Serial SP08a.
The proposer has defined HTR sites as small industrial sites that are unattended and located in remote areas. They have no telecom infrastructure or equivalency available for Advanced Meters or smart Meters. Despite making all practicable effort, it is often not possible for Suppliers to obtain Meter readings at these locations.
Due to the nature of the NHH performance requirements, small Suppliers are most susceptible to HTR related SP08a Supplier Charges. The proposer believes they are unfairly disadvantaged and are less able to compete competitively for customers with HTR sites. This is because, in contrast to large Suppliers, the inability for small Suppliers to absorb HTR sites into their Settlement performance means that they must price the SP08a Supplier Charge cost into their Supply contract, which makes their prices less competitive.
The Initial Written Assessment was presented to the Panel on 10 May 2018. The Panel approved P366 to proceed to the Assessment Procedure and the associated timetable. The Panel agreed the Workgroup membership and Workgroup’s Terms of Reference pending some additions suggested during the meeting.
The Panel was required to submit to the Authority a Significant Code Review (SCR) Suitability Assessment Report in regards to whether P366 falls within the scope of the three SCRs being undertaken. The Panel considered the draft SCR Suitability Assessment Report at their 14 June 2018 meeting and the SCR Suitability Assessment Report (see below) has now been submitted to the Authority.
The first Workgroup meeting was held at ELEXON on 7 June 2018. The Workgroup identified several areas of analysis and investigation that are required in order to progress P366.
The second Workgroup meeting was held at ELEXON’s office on 7 August 2018. ELEXON prepared Business Requirements for three potential System options discussed at the second Workgroup as well as a potential Alternative solution. The third workgroup was held on 22 Nov 18 to discuss the merits of the Proposed solution, the first Alternative and the second Alternative.
P366 will progress in accordance with the approved Assessment Procedure timetable unless the Authority determines that is shall be a SCR Subsumed Modification.
The Proposer and Workgroup have agreed a Proposed and Alternative solution for Assessment Procedure Consultation, which ELEXON are currently preparing with a view to issuing this in February 2019.