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

Current Status

Submission
Initial Written Assessment
Assessment Procedure
Report Phase
With Authority
Awaiting Implementation
Implemented

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 is raising this Modification to progress the solution developed and assessed by the P361 Workgroup.

Podcast

Listen to Senior Change Analyst, Fungai Madzivadondo’s podcast on P396, which gives a quick explanation of the issue it aims to resolve and the organisations that would be affected by the change:

If you would like a transcript of the podcast please email [email protected].

Progression

On 6 March 2020, the Authority approved the P396 Modification Proposal for implementation on 5 November 2020. 

The P396 Final Modification Report was submitted for Authority decision on 23 January 2020. 

The P396 Report Phase Consultation  was issued for 16WD industry consultation on 17 December 2019 with responses due by 5pm 10 January 2020.

Nord Pool AS raised P396 on 10 December 2019. The BSC Panel considered the Initial Written Assessment  12 December 2019 and agreed to sent P396 straight to the Report Phase.

 

Next Events

P396 will be implemented on 5 November 2020 as part of the November 2020 BSC Release.

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