EDCM update

16 August 20121 | Energy Networks Association – DCMF

Mo Sukumaran

(CMG Chair)

Current position – EDCM

16 August 20122 | Energy Networks Association – DCMF

• The EDCM for import charges is currently in force (from 1 April 2012) and is subject to open governance.

• On 1 June 2012, DNOs submitted new proposals for the EDCM for export charges.

• NPG (on behalf of the DNOs) has submitted a DCP (DCP 152) to incorporate the EDCM for export charges into DCUSA for implementation on 1 April 2013.

• On 1 June 2012, DNOs submitted a report to Ofgem to meet Condition 3 of Ofgem’s approval of the EDCM for import charges. Condition 3 relates to “network use factors”.

EDCM update

16 August 20123 | Energy Networks Association – DCMF

EDCM for export charges

EDCM for export charges

16 August 20124 | Energy Networks Association – DCMF

• Ofgem guidance on the methodology for export charges published on 2 February 2012.

• DNOs have been working jointly to develop new proposals through Workstream B and stakeholders consulted.

• We received a large number of responses to our consultation with constructive suggestions for improvements.

• We improved our proposed method in light of consultation responses.

EDCM for export charges

16 August 20125 | Energy Networks Association – DCMF

• Our final proposals for export charges were submitted to Ofgem on 1 June 2012.

• Submission documents, including illustrative export charges for 2012/2013 and our responses to the consultation responses are available to download on the ENA website.

• We are waiting for Ofgem to make a decision on proposed EDCM for export charges.

• Ofgem’s decision is expected in the autumn.

Next steps

16 August 20126 | Energy Networks Association – DCMF

• Have submitted a DCUSA change proposal that seeks to incorporate our proposed method into DCUSA.

• Allows the DCUSA panel and stakeholders sufficient time to consider these proposals before they are used to set indicative charges for 2013/2014.

• Also, the deadline for opting in to the EDCM for export charges/credits for 2013/2014 has now passed (30 June 2012).

EDCM update

16 August 20127 | Energy Networks Association – DCMF

Condition 3 of the EDCM for import charges

EDCM import – Condition 3

16 August 20128 | Energy Networks Association – DCMF

• Ofgem had placed 3 conditions on its approval of the EDCM for import.

– Conditions 1 and 2 have been met and the methodology updated.

– Condition 3 relates to the treatment of spare capacity in calculating network use factors for demand.

• Workstream A of the CMG has developed new proposals that satisfy the requirements of Condition 3 and stakeholders consulted.

• We received two responses to the consultation which supported the proposals but raised concerns on the potential change to import charges.

Next steps

16 August 20129 | Energy Networks Association – DCMF

• We believe that the change represents an improvement to the method and addresses concerns raised by stakeholders about the treatment of spare capacity on the network.

• We have submitted our report to Ofgem on 1 June 2012 along with our recommendation that the change be implemented as soon as practicable.

• DNOs have submitted a DCUSA change proposal to this effect (DCP 138).