If you have a Half Hourly (HH) electricity supply you need to be aware of a major change due to take place in April 2018. If you don't know if you have one or not, you will need to check the profile class on your most recent invoice. Normally, it will look like the illustration below. If you have a profile class of 00, you have a Half Hourly electricity supply.

From 1 April 2018 Ofgem will be introducing a new measure called DCP 161 which will charge end users who exceed their Half Hourly Assigned Available Capacity (ASC) at an excess penalty rate. This will allow Distribution Networkd Operators (DNOs) to recover the additional costs they can incur when customers exceed their available capacity levels.

To discover if you're at risk of being penalised, you will need to check your electricity invoices to see whether you have any ‘price lines’ showing as Excess Capacity Charge (see below).

As the example above shows, at present, the supplier adds the excess units of power (kVa) in the month of the breach at the standard contracted ASC rate.The amounts are often minimal and therefore give no incentive for end users to review and lower or increase capacity where required.

The penalty rates to be introduced in April 2018 have not yet been published. They will vary by region and voltage but they could be more than three times higher than the standard rate. If a supply is regularly exceeding its ASC, this change could increase the overall electricity costs by 1-2 per cent or more depending on the consumption profile.

Electicity supplies affected by P272, which amends the way energy use metered and billed, should all have been changed to Half Hourly by the time DCP 161 comes into effect. This may be the biggest area of concern as most P272 supply points were just assigned automatic/standard authorised supply capacity levels. These levels were not confirmed by most end users, meaning there could be more problems than benefits to these supplies.

Any site that is incurring excess capacity charges will need to undertake a capacity review. Equally, it is important for businesses or end users with Half Hourly electricity supplies not only to undertake energy-saving measures to reduce demand at peak times to avoid these new penalty charges, but to help with outgoing costs of their business.

Further information

Contact Savills Energy & Infrastructure