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This proposal comes on the back of a white paper issued last year by Elexon, the body responsible for administering the BSC. As highlighted in both the relevant BSC modification proposal document and in the previous white paper, the proposed changes are likely to be of considerable interest to those contemplating a range of new business models, including:
It will also likely be of considerable interest to existing licensed suppliers who, if the proposed modifications are implemented, may find themselves having to accommodate new multi-party supply arrangements when dealing with the forecasting and billing of supplies to existing customers.
A core feature of the system governed by the BSC is that a particular entity, usually a licensed electricity supplier, is registered in relation to each grid import or grid export metering point. As a general rule, under these arrangements anyone wanting to sell electricity via the grid to a particular end-consumer will only be able to do so by entering into a commercial deal with the relevant supplier who is registered in relation to the grid meter which serves that end-consumer's premises.
The proposed modification effectively allows for volumes of electricity measured by a particular grid meter to be split between different parties.
To illustrate this, the Elexon white paper describes the following example scenario:-
As things currently stand, in a scenario such as the one above Supplier A would be treated as the party with sole responsibility for system balancing purposes for the full 0.5kWh of electricity recorded by the grid meter during the relevant half hour period. Supplier B and Supplier C would likely only be able to give effect to their respective electricity sale arrangements with the consumer by having a specific commercial agreement in place with Supplier A.
Under the proposed modifications, a "Customer Notification Agent" would facilitate the splitting of relevant electricity volumes between Suppliers A, B and C for BSC purposes so that:-
The modification proposal highlights a number of issues that will need to be considered further by a relevant BSC workgroup prior to the modification being submitted for approval under the BSC governance process. This includes a need to consider how responsibility for paying network charges associated with particular volumes of grid electricity could be split between different suppliers in an example scenario such as the one above.
Subject to this, the aspiration on the part of the proposer of the modification is for implementation to occur by April 2020.
This publication is intended for general guidance and represents our understanding of the relevant law and practice as at January 2019. Specific advice should be sought for specific cases. For more information see our terms & conditions.
09 January 2019
by Stuart Urquhart
Insights 14 SEPTEMBER 2021