USRV Resolution Responsibility and Occurrence E8.1.1 “…the User shall investigate Reconciliation Values that have been Suppressed following Individual NDM Reconciliation…” E8.1.2 Suppression occurs in accordance with the Network Code Reconciliation Suppression Guidelines Financial tolerances per AQ banding Underlying negative consumption Guidelines reviewed from time to time
Why Suppress? Network Code Reconciliation Suppression Guidelines para 2.6 “The tolerances are set with a view to maximising the suppression of values generated from erroneous data and minimising the suppression of valid values” Intended to protect Users from large erroneous invoice values energy invoice must be paid first and subsequently queried potential to cause severe financial hardship
Issues Identified pre 0637 Implementation Uncertainty created for RbD Users by unresolved items Considerable USRV backlog (38,000 items plus). Lack of incentive for non-RbD Users to resolve Lack of incentive for compliance with existing Network Code resolution requirements Selective resolution? More economic to leave unresolved Approval of credits only Lack of priority
Mod 0637 – Network Code Process Various options discussed at Network Code Reconciliation Suppression Guidelines Sub-Group in 2003 Initial proposal for incentives raised by a Shipper Following discussions at Suppression Guidelines Sub- Group, Modification Proposal submitted by Transco Final Modification Report issued to Ofgem on 15 Sep 2003 Direction to Implement issued by Ofgem on 19 Nov 2004 Following consultation with the Supply Point & Billing Workstream, Modification implemented on 21 Feb 2005
Mod 0637 Regime – Resolution Incentives (E8.3) Backlog (pre 21 Feb 2005) Unresolved after 4 months (or older) incurs £30/month until resolved Ongoing Performance 50% resolution required by 20th of following month (no incentive charge applied) 95% resolution required by 20th of second month. Any unresolved below the 95% standard incur £20 Any unresolved after 4 months (or older) incurs £30/month until resolved Additional features Allowance for significant volume increases >20 USRV item increase, and => 50% increase (in comparison to previous 6 months average) additional 1 month on 2 and 4 month standard
Mod 0637 Regime – Re-distribution of Revenue Overall monthly cap £100,000. If exceeded all charges scaled down to in aggregate equal £100,000. 2% allowance for Transporters for administration of scheme Remaining revenue allocated to RbD community Based on market share for relevant LDZ for relevant period
Mod 0637 Regime – Effectiveness? Is the current level of USRVs a concern for Users? Why is the regime arguably not working? What changes could be made to improve performance Changes to the existing regime? Additional measures?