Elexon reaches 20 years as BSC manager

Saturday 1 August 2020 marked Elexon’s 20 year anniversary as manager of the Balancing and Settlement Code (BSC).

NETA was implemented in England and Wales to enable electricity to be traded bilaterally, and ahead of time, between willing buyers and sellers in an open and competitive wholesale market. The NETA arrangements were extended to Scotland in 2005 through the British Electricity Trading Arrangements (BETTA).

Elexon became the manager of the BSC ahead of the New Electricity Trading Arrangements go-live on 27 March 2001.

Big increase in the number of customers we serve

Elexon makes sure that payments for imbalances in wholesale electricity supply and demand are settled accurately and efficiently. This involves processing around 1.25 million meter readings a day. As the energy market has changed and more companies have entered it our role has grown. We now serve 489 BSC Parties compared with around 55 Parties in 2000.

In 20 years, Elexon and the BSC has been through a lot of change. We have:

  • Implemented 256 modifications to the BSC.
  • Implemented 772 changes to BSC subsidiary documents and systems.
  • Worked through 90 BSC Issues and identified a suitable solution.

Our work helps to re-shape the electricity system

Elexon’s Chief Executive, Mark Byrgraves, said:

‘Elexon’s role has evolved significantly as the energy system has changed. We offer an ‘end-to-end’ management service for the code. This means that as well as managing the change process for the rules, we work with BSC Parties that propose changes to the code so that the BSC responds to future challenges.

We also provide and operate the systems that give effect to those rules. Additionally we support BEIS, Ofgem and other stakeholders in implementing policy initiatives relying on our deep expertise of market arrangements and operation.

Our work is helping to re-shape the electricity system and support the objectives of Government and Ofgem for a smarter, more flexible system. We are looking forward to working with stakeholders on further ground-breaking reforms on the road to net-zero. I’d like to thank everyone who has worked for, and with, Elexon and helped to shape the organisation that we are today.’

Looking back on our work

During our 20 years, we have also been involved in many exciting projects and initiatives:

BETTA

In 2002 Ofgem approved Modification P108. This change allowed Elexon to extend its vires and work with Ofgem in preparation for BETTA. 

It included planning the transition from the existing arrangements in England and Wales and Scotland, and the introduction of a GB-wide Balancing and Settlement Code.

This was implemented in 2005.

Creation of EMRS

During 2013 and 2014 Elexon provided expertise to the UK Government to introduce Electricity Market Reform (EMR) Contracts for Difference, and Capacity Market settlement which is carried out by Elexon’s subsidiary EMR Settlement Ltd.

A digital platform for the future

Elexon has been developing a digital platform, which will modernise the technical architecture of BSC systems. The result will be a flexible, scalable platform providing digitalised market entry, Settlement, and data insight services to support a smarter electricity system.

The Settlement Solution, which performs scalable, flexible and modular electricity Settlement calculations was deployed it as part of the ‘Wider Access’ aspects of the December 2019 Modification P344 release.

Ofgem’s Significant Code Review

More recently, Elexon has been playing a leading role in supporting Ofgem’s Significant Code Review on Market-wide Half Hourly Settlement.

We do this by chairing and providing technical leadership through the following groups:

BSC sandbox

In 2018, Elexon became the first code administrator to have a sandbox introduced (following approval of P362) so that innovators can trial new products and services without having to meet the usual BSC rules.

Now that Ofgem has re-launched the energy regulation sandbox, we can offer the BSC sandbox to innovators for the first time.

Enabling Multiple Suppliers

In 2018, Elexon published a white paper on how BSC central services could be adapted to offer Settlement solutions that allow customers to buy electricity from more than one supplier, while using the same meter.

This paper became the basis for Modification P379 ‘Multiple Suppliers through Meter Splitting’.

Projects TERRE and MARI

In recent years Elexon has engaged with political and legislative developments in the European Union.

This includes carrying out, and consulting on extensive planning to manage the potential impacts of Brexit on the electricity market arrangements.

We are also working closely with National Grid ESO to implement arrangements for GB Participation in Project TERRE, and developing the solution for GB participation in Project MARI.

Distribution System Operators

Elexon has been engaging with the Energy Networks Association (ENA) Open Networks project to help define the role of Distribution System Operators (DSOs) in the future electricity market.

Proposal on flexibility markets

Elexon has proposed in a Policy View that nationwide ‘flexibility markets’ could be set up to operate in a similar way to the existing wholesale electricity market, where buyers and sellers can trade flexibility or spare capacity at prices set by the market.

Supporting the Energy Codes Review

Elexon is a strong supporter of reforms to consolidate and simplify the energy codes landscape, so that they support innovation by energy companies to meet net zero.

We have shared our views with Ofgem and BEIS on how this could best be achieved.

We published two policy views on our proposals for consolidation and interim steps to speed up rule changes for the codes, before wider reforms are introduced.

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