P426 ‘Combining related BSC Parties’ Energy Indebtedness positions for the Credit Cover Percentage calculation’
Formal title: Combining related BSC Parties' Energy Indebtedness positions for the Credit Cover Percentage calculation
This Modification proposes to remove inefficiencies with the Credit Cover calculation by allowing related BSC Parties to combine their Energy Indebtedness prior to calculating the Credit Cover Percentage.
Where BSC Parties are related (e.g. within the same corporate body), the proposal is that the Energy Indebtedness of each BSC Party should be combined and the Credit Cover Calculation then performed on the combined position. Parties would assume joint liability in the event Elexon calls on Credit, and so overall risk to Settlement should remain the same as for the current arrangements.
The P426 Proposer (Drax Energy Solutions Limited) requested that P426 be withdrawn from the BSC Change process on 12 December 2022.
P426 was raised to provide an option of combining the Energy Indebtedness for related BSC Parties and for the Credit Cover Calculation to be performed on the combined position, with the aim that less Credit Cover collateral would need to be provided. The Proposer was seeking a simple and straightforward solution, however, during the Assessment Procedure and development by the Workgroup it became apparent that it would be extremely complicated to develop the concept into a workable and cost effective solution. The Proposer therefore decided that P426 should be withdrawn.
Per BSC Section F ‘Modification Procedures’, Section 2.1.12B, P426 was subject to a period where the withdrawn Modification Proposal remained open for adoption. This adoption period lapsed at 17:00 on Tuesday 20 December 2022. No BSC Party adopted P426 and therefore the Modification has been officially closed.