Compliance procedures through Performance Assurance
This page will tell you all about the different ways that we monitor and manage your performance against your requirements and obligations within the Balancing and Settlement Code (BSC). Part of ELEXON’s role as administrator of the BSC is to monitor the compliance of all BSC parties and to run Performance Assurance activities. There are a number of techniques that ELEXON uses to confirm compliance or identify issues that may need to be addressed.
The Performance Assurance Diagram explains the annual cycle of Performance Assurance which starts with a methodology for identifying Settlement Risks.
We evaluate and set out how to manage these Settlement Risks through the Risk Evaluation Register, Risk Operating Plan and individual Risk Management Plans before deploying the techniques and reporting the results in the Annual Performance Assurance Report.
The annual cycles are referred to as Performance Assurance Operating Periods (PAOPs). The timetable for each PAOP can be found on the Performance Assurance Processes webpage.
How it relates to you
Each year, the BSC Panel and the Performance Assurance Board (PAB) use the Performance Assurance Framework (PAF) to manage Settlement Risks. The Performance Assurance Framework (PAF) is in place to provide assurance that:
- Energy is allocated between Suppliers efficiently, correctly and accurately
- Suppliers and Supplier Agents transfer Metering System data efficiently and accurately
- Calculations and allocations of energy and the associated Trading Charges are performed within the BSC requirements
Performance Assurance Techniques (PATs) are applied to Performance Assurance Parties (PAPs) based on the Settlement Risks that they pose. To do this, the BSC Panel and the PAB identify, evaluate and prioritise the risks that may occur within Settlement and the extent to which they apply to each PAP. These PAPs include;
- Meter Operator Agent
- Data Collector
- Data Aggregator
- Meter Administrator
- Licensed Distribution System Operator and/ or a Registrant
Settlement Risks are relevant to any PAP which might send, receive or take action in respect of processes, controls or data which relate to the risk in question. The Supplier is a relevant PAP in respect of Settlement Risks relating to the activities of Party Agents.
How are the techniques used?
Each year, the BSC Panel and the PAB deploy the PAF to manage Settlement Risks. The BSC Panel and the PAB produce the following suite of documents in line with the Annual Performance Assurance Timetable. This is done in consultation with industry.
Risk Evaluation Methodology (REM)
Identifies and Evaluates and Assesses the materiality of Settlement Risks
Risk Evaluation Register (RER)
Sets out the risks, and the significance of each risk on Settlement and explains the annual process of review whereby existing risks are amended
Risk Operating Plan (ROP)
Details how each technique has been used to address the identifies Settlement Risks and any changes to the deployment of PATs for a given BSC Year
Annual Performance Assurance Report (APAR)
Provides the results of the risk evaluation and risk assurance procedures for a given BSC Year
ELEXON use the techniques to assess whether there are any active issues or risks that might impact on Settlement and where your company may not be meeting your obligations. These techniques are divided into 4 categories:
Some of the techniques are deployed on a cycle (e.g BSC Audit is an annual activity, the TAA audit is performed to an annual cycle) and others are deployed on an ad hoc basis (e.g TAPAP checks are targeted checks, EFR is deployed following a non-compliance)
How we monitor your performance and any potential risks
The BSC Audit is performed on all Parties above a certain size on an annual basis. ELEXON performs Performance Monitoring And Reporting (PARMS) which checks that PAPs are meeting their targets for delivering correct data into Settlement. Material Error Monitoring checks for contributions by each PAP to errors in Settlement and the effects of the errors on other PAPs. These are both done on a monthly basis.
We may also visit you for a Technical Assurance of Performance Assurance Parties (TAPAP) check. If you perform one of the processes we wish to investigate that is potentially causing a risk to Settlement, you may be contacted to arrange a suitable date to visit your offices for the audit. We may also run a check following implementation of a Modification or if we have identified an issue through one of the other techniques to investigate the route cause.
Our Technical Assurance Agent (TA) service consists of a combination of sampled and targeted visits to sites with Half Hourly Metering Systems registered in SVA and CVA. The audits are designed to monitor the compliance of these Metering Systems with BSC requirements, in particular the Metering Codes of Practice (CoP). If the TAA visits one of your sites and non-compliance are identified, you will be required to rectify the error by providing evidence or taking any relevant action.
All findings for these techniques are reported to the PAB.
Reporting findings and recommendations to PAB
After ELEXON has deployed any of these detective PATs, a report is sent to the PAB listing any issues and putting forward appropriate recommendations. The Board will then consider the report and come to a decision about what potential changes may need to be introduced.
At this point, those companies affected by the Board’s decision will be contacted and full disclosure of the risks and recommendations will be communicated.
The Performance Assurance Board (PAB) is part of the groups and committees coordinated by ELEXON. The PAB is appointed by, and reports to the BSC Panel. You are able to attend any of the open meetings or become a PAB member.
Finding a resolution
One of the recommendations that could be presented to the PAB following any of the PAT techniques could be to switch on Error and Failure Resolution (EFR). This technique is a remedial technique where you provide a plan of action with milestones to address and rectify the areas of non-compliance and underperformance against obligations and standards prescribed in the BSC.
Once the resolution has been agreed by all those involved, you will work with ELEXON on implementing the changes to an agreed timetable. ELEXON will undertake a reassessment to confirm that the issue in now closed and the process concluded.
Another recommendation that may be presented to the PAB following identification of an issue could be to utilise the BSC Change Mechanisms. If there was an identified weakness or defect in the arrangements set out in the BSC, a Modification Proposal or Change Proposal to address the identified defect is raised.
There are other remedial techniques that work to rectify errors and such as the Trading Disputes process which is used when incorrect data has entered settlement. It can sometime be used following an investigation raised by one of the other techniques, for example during a TAA audit.
Non-compliance to resolution request
The Performance Assurance Board (PAB) can remove a Qualified Person’s Qualification if the organisation fails to comply with certain requirements and standards. In this circumstance, the following types of market participants may go through the Removal of Qualification (RoQ) Process:
- Half Hourly and Non Half Hourly Data Collectors
- Half Hourly and Non Half Hourly Data Aggregators
- Half Hourly and Non Half Hourly Meter Operators and CVA Meter Operators
- Meter Administrators
BSC Parties are not subject to RoQ; Significant or persistent breaches of the BSC are addressed under the Breach and Default provisions of the BSC.
Appealing to PAB
A member of ELEXON’s subject matter expert team will liaise with your company to discuss the Board’s decision following the identification of an issue or non-compliance and to assess how it will impact on your processes. An assessment will identify a potential resolution which you will need to implement within an agreed deadline in order to close the performance issue.
If you disagree with how the Performance Assurance Techniques have been deployed for you, you can raise a query to the PAB. You can appeal the PAB’s decision if:
- The PAB has not followed due process
- The PAB has over or under-emphasised on certain circumstances or evidence submitted
- The PAB has misinterpreted all or some of the evidence submitted
You can appeal a PAB decision if you are a BSC Party and are acting:
- directly as a Performance Assurance Party (PAP)
- on behalf of the Party Agent
You need to send an email detailing your query to email@example.com within 10 Working Days of receiving your RMP. It should detail why you disagree with your RMP and evidence to support your query. We will confirm receipt of your query and may request further information.
The PAB will consider your query at the next available meeting and will decide whether or not it accepts it. If the PAB accepts the query we will make the appropriate revisions to your RMP.
Your appeal should specify the reason why you believe the BSC Panel should modify your RMP and provide supporting evidence. You can send the query through to the Performance Assurance Administrator (PAA) at firstname.lastname@example.org.
The BSC Panel will decide whether it accepts the appeal at the next appropriate meeting and we will notify you of the Panel’s decision which is final and binding.
Once a query or appeal is raised, the changes to your RMP will be suspended until the PAB or BSC Panel decide to remove the suspension.
A number of the techniques do also have their own escalation process detailed in their respective procedure documents. Alternatively, you can ask your Operational Support Manager for more information.