P402 ‘Enabling reform of residual network charging as directed by the Targeted Charging Review’
Formal title: Enabling reform of residual network charging as directed by the Targeted Charging Review
Following the conclusion of its Targeted Charging Review Significant Code Review , Ofgem directed National Grid and certain LDSOs to make changes to how residual revenues are recovered through Distribution Use of System (DUoS) and Transmission Network Use of System (TNUoS) demand charges.
P402 will introduce new reporting requirements on LDSOs and BSCCo that will ensure the provision of data to enable the NETSO to set TNUoS demand residual tariffs and enable accurate billing of subsequent charges.
Current Status
Implemented
P402 was implemented in the February 2022 Standard BSC Release.
Awaiting Implementation
P402 configurable items were issued for industry review on 10 September 2021, with comments welcomed by 24 September. The documents, response form and supporting materials can be found under this “Awaiting Implementation” tab below.
Ofgem approved the Alternative P402 solution for implementation on 24 February 2022.
P402 NGESO Direction Letter
P402 Authority Decision Letter
February 2022 Release – review of Configurable Items
With Authority
The Panel made their final recommendation that the Alternative Solution should be approved and the Proposed Solution on 11 March 2021. P402 is now with Ofgem awaiting their decision.
P402 Final Modification Report
Report Phase
P402 was for issued Report Phase Consultation on 16 February 2021, with responses invited by 5pm on Monday 1 March 2021.The Panel made their final recommendation that the Alternative Solution should be approved and the Proposed Solution on 11 March 2021. P402 is now with Ofgem awaiting their decision.
P402 Final Modification Report
P402 Draft Modification Report
P402 Consolidated RPC Responses
P402 Report Phase Consultation
Assessment Procedure
The first Workgroup meeting took place on 31 March 2020. Following an update that Ofgem has pushed implementation of TCR change to 2022, the group wish to consider alternative options at its next meeting and extend the Assessment Procedure for P402.
The second Workgroup took place on 6 May 2020, where the Workgroup agreed to an amended solution, noting that it better addresses concerns from some BSC Parties by centralising the approach to aggregating Non Half Hourly data thereby reducing the burden on LDSOs. The Proposer agreed that this would be a more efficient approach and agreed to adopt this.
Elexon had been working to a timetable whereby P402 is handed to Ofgem in October 2020 for consideration alongside other TCR code modifications. Over the course of Legal Text development and Impact Assessment, several complicating factors and clarifications have resulted in delays to accurately estimating the impact and cost on BSCCo for P402.
The third Workgroup took place on 5 August 2020. The group discussed how P402 has a soft dependency for the related CUSC modifications – they will rely on a solution that provides NETSO with data for billing and tariff setting being implemented by April 2022. It was agreed that whilst P402 enables the TNUOS TCR arrangements, it doesn’t implement any of the core requirements of Ofgem’s TCR SCR decision.
Having liaised with Ofgem and the TCR Implementation Steering Group (4 August), Authority receipt of Panel-approved P402 Legal Text and IA would not be strictly necessary for them to come to a decision on other TCR modifications.
Consequently Elexon has requested a 2 month extension to the Assessment Procedure, to provide some contingency for P402.
On Monday 2 November the Workgroup voted to raise an Alternative Modification. They acknowledge that the raising of the Alternative at this late stage impacts the delivery of P402 to TCR timescales but felt that the potential benefits of a simplified new approach outweigh this concern.This Alternative required Elexon to develop Business Requirements, Legal Text and capture industry costs for this Alternative before the Assessment Report can be submitted..The group considered Alternative Business Requirements at the 6th Workgroup on 28 November. The 2nd APC closed on 15 December. At the 7th 402 Workgroup meeting on 17 December 2020, the Workgroup considered responses to the 2nd Assessment Consultation and finalised the Business Requirements for both Proposed and Alternative solutions.
The P402 Assessment Report was presented to the February 2021 Panel meeting, where the Panel initially recommend the approval of the P402 Alternative Solution, and rejection of the Proposed Solution.
P402 Assessment Report
P402 Workgroup 7 Slide Content
Collated 2nd Assessment Procedure Consultation Responses
P402 Second Assessment Procedure Consultation
P402 Workgroup 6 Slide Content
P402 Workgroup 5 Slide Content
Collated Assessment Procedure Consultation Responses
P402 Assessment Procedure Consultation
P402 Workgroup 4 Slide Content
P402 Workgroup 3 Materials
P402 Workgroup 2 Materials
P402 Workgroup 1 Materials
Initial Written Assessment
The BSC Panel considered the IWA at its meeting on 12 March 2020, where it will agree how to progress this Modification.
P402 Initial Written Assessment
Submission
National Grid raised P402 ’Enabling reform of residual network charging as directed by the Targeted Charging Review’ on 5 March 2020.
Next Steps
We are currently drafting the Initial Written Assessment (IWA) for P402 and will publish this on the P402 page of our website in due course. The BSC Panel will consider the IWA at its meeting on 12 March 2020, where it will agree how to progress this Modification.
The first Workgroup meeting is likely to be on 31 March, 1 April or 2 April.