Supplier Charges
Supplier Charges are liquidated damages that Suppliers incur if they fail to meet certain performance levels. They compensate Parties disadvantaged by those who aren’t meeting defined Standards. We consider them to be a remedial technique in our Performance Assurance Framework.
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How it relates to you
Each month, the Performance Assurance Board (PAB) authorises Supplier Charges. The Supplier Charges are then distributed among Trading Parties.
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90% of funds collected from a GSP Group are re-distributed to the Non Half Hourly (NHH) Suppliers operating in the GSP Group, based on their share of NHH energy traded in the GSP Group
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10% are re-distributed to all Trading Parties based on their Main Funding Share
How are Supplier Charges calculated?
The Performance Assurance Reporting and Monitoring System (PARMS) software calculates the Supplier Charges due each calendar month.
These charges are capped for each Supplier to limit each Party’s liability in any one reporting period. A GSP Group monthly liability cap is calculated based on its annual take for the previous financial year.
A Supplier’s monthly liability cap is calculated based on its total active import energy in the reporting period.
What are the Serials used to calculate them?
Supplier Charges are incurred for underperformance against the PARMS ‘Serials’ described in the table below. Supplier Charges are applied based on underperformance by Supplier ID, reporting period (Calendar Month) and GSP Group.
| Serial | Serial Description | Standard |
| SP02 | Delivery of Routine Performance Monitoring Logs | Zero Working Days that Drill Down or Ad-Hoc data has not been submitted to the Performance Assurance Administrator (PAA) |
| SP08a | Percentage of Non-Half Hourly (NHH) Energy Settled on Annual Advances | R3 – 80% RF – 97% |
| SP08b | Percentage of HH Energy Settled on Actual Readings | SF – 99% R1 – 99% |
| SP08c | Percentage of non-mandatory HH Energy Settled on Actual Readings |
RF – 99% |
Supplier Charges in Market-wide Half-Hourly Settlement
The implementation of Market-wide Half Hourly Settlement (MHHS) will impact the principles, systems, and delivery of the Supplier Charges Performance Assurance Technique (PAT). It remains a key incentive for Suppliers to achieve high Settlement Performance, and compensate parties disadvantaged by those with poor Settlement Performance.
They are also described in BSCP710: Supplier Charges for MHHS Metering Systems, and in BSC Section S-1: Performance Levels and Supplier Charges.
Please note that these documents are only available on the MHHS website at present and need to be accessed using the MHHS Programme Document Search.
Performance Assurance Framework
Supplier Charges are a remedial technique in Elexon’s Performance Assurance Framework.