P396 ‘Revised treatment of BSC Charges for Lead Parties of Interconnector BM Units’

Formal title: Revised treatment of BSC Charges for Lead Parties of Interconnector BM Units

Summary

Interconnector Users in Great Britain (GB) are liable for the BSC Costs equivalent to the market share of the export and import registered on their Interconnector Balancing Mechanism (BM) Units. The application of BSC Charges to cross-border flows creates a differential between those trades that facilitate competition within a national market and pan European trades that facilitate competition across a single European electricity market. Efficient trading between GB and other Member States is therefore compromised.

In the BSC Interconnector flows are treated as production or consumption for the purposes of calculating BSC Charges. This does not clearly best facilitate EU Third Package (EC 714/2009) Article 2 which defines an Interconnector as “a transmission line which crosses or spans a border between two Member States and connects transmission systems of Member States”.

P396 has been raised to progress the solution previously developed under Modification P361 ‘Revised treatment of BSC Charges for Lead Parties of Interconnector BM Units’. Modification P361 was raised on 31 October 2017 and submitted for Authority decision on 13 July 2018.

On 22 October 2019, the Authority confirmed agreement with Elexon’s assessment that P361 has ‘timed out’. The Authority was not in a position to make a determination on P361 by 1 November 2018. Therefore P361 was closed as the Authority could not make a decision to approve or reject the modification.

The Authority and Elexon engaged with Nord Pool AS (P361 Proposer), who raised P396 to progress the solution developed and assessed by the P361 Workgroup.