252/13 – SCOPE FOR REVIEW OF MARKET ENTRY, EXIT AND
QUALIFICATION ARRANGEMENTS AND FOR REVIEW OF
METERING DISPENSATIONS AND NON-STANDARD BMU
MEETING NAME
BSC Panel Meeting
Date of meeting
12 May 2016
Paper number
252/13
Owner/author
Nicholas Rubin
Purpose of paper
Decision
Classification
Public
Summary
The BSC Panel identified a series of Strategic Reviews. ELEXON has developed
scopes for the review of the BSC Market Entry, Exit and Qualification
arrangements and the review of Metering Dispensations and non-standard
Balancing Mechanism Units (BMUs). ELEXON invites the BSC Panel to approve
the scopes of these reviews and appoint Panel Sponsors for each review.
1.
Panel’s Strategic Work Programme
1.1
The BSC Panel identifies key strategic work in its Strategic Work Programme. The Panel last reviewed and
approved its Work Programme in February 20161. Amongst other things, the Work Programme summarises
the need to complete a ‘Review of Market Entry and Qualification Arrangements’ and a ‘Review of
Dispensations and CoPs (Codes of Practice)’.
1.2
As an initial step the Work Programme notes that ELEXON will present the scope of these reviews to the
Panel for its approval.
1.3
The remainder of this paper and its attachments set out the scope and other aspects of the reviews and
seeks the Panel’s approval to proceed with the reviews.
2.
Review of Market Entry, Exit and Qualification arrangements (RMEQ)
Executive Summary
2.1
2.2
ELEXON proposes to complete a review of Market Entry, Exit and Qualification arrangements to:
●
Identify where we can improve the efficiency of the BSC Entry, Exit and Qualification arrangements for
applicants, BSC Parties and for ELEXON, i.e. reduce cost and time;
●
Identify how we can improve the guidance and support we provide applicants entering and Parties
and Party Agents exiting the BSC arrangements; and
●
Identify to what extent the BSC Entry and Qualification arrangements are flexible enough to
accommodate new or changes to (prospective) Parties operating models, i.e. are future proof.
This review will cover all SVA and CVA Market Entry (including Qualification and Registration) and Exit
processes. It will focus specifically on the efficiency of the processes, and the range and content of guidance
1
Please see https://www.elexon.co.uk/wpcontent/uploads/2015/10/33_249_10A_BSC_Panel_Strategic_Work_Programme_PUBLIC.pdf
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252/13 – SCOPE FOR REVIEW OF MARKET ENTRY, EXIT AND
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METERING DISPENSATIONS AND NON-STANDARD BMU
and support. It will not consider the rationale for or principles that underpin the Entry, Qualification and Exit
arrangements.
2.3
In terms of Market Entry we have characterised the scope as covering all processes from the point of an
initial enquiry through to the point at which energy can be allocated to the Party’s energy accounts. For
Market Exit we will consider all processes from the point a Party signals its intention to withdraw, the Panel
decides to expel a Party or the PAB decides to remove a Party Agents’ Qualification, through to the point at
which the Party or Party Agent is no longer recognised by the BSC.
2.4
Over the last 12 months ELEXON has completed a large amount of work focused on improving the delivery of
Entry, Exit and Qualification arrangements. For example,
●
Developed information packs and standard communications targeted at ‘off the shelf’ suppliers
●
Streamlined the Market Entry page on the ELEXON website
●
Investigated use of submitting Self-Assessment Documentation online
●
Working with Gemserv to update Market Entry Joint Story Boards
●
Worked with Ofgem to prepare for introduction of first Licence Lite Suppliers
2.5
This review will take stock of the work completed to date and build upon it to demonstrate whether the full
range of Market Entry and Exit processes, support and guidance are fit for purpose today and into the future.
2.6
We recognise that participating in the energy market is not limited to the BSC arrangements. Whilst we do
not propose to review the detail of entering other industry code or license based arrangements, we will
identify overlaps and interdependencies between the BSC and those other arrangements, and make
recommendations to clarify or remove unnecessary overlaps and improve the coordination and execution of
dependent processes.
2.7
Bearing in mind the scale of the review, ELEXON’s other operational activities and subject to detailed
planning and resourcing, we will use our reasonable endeavours to complete the review within eight months.
ELEXON will produce a final report containing observations and recommendations. We aim to present our
final report to the Panel in early 2017. The Panel will then have the opportunity to consider whether to
initiate a programme of work to implement the review’s recommendations.
2.8
We plan to provide regular updates to the Panel. Therefore, if the opportunity arises we will fast-track the
presentation of recommendations for the Panel to consider, prior to concluding the full review and submitting
our Final Report to the Panel. This should enable the Panel to consider and approve the implementation of
‘quick wins’.
2.9
The proposed context, objective, scope, workstreams and deliverables for this review are set out in more
detail in Attachment A.
3.
Review of Metering Dispensations and non-standard BM Units (RMDB)
Executive summary
3.1
ELEXON proposes to complete a review to:
●
Identify themes and observations from existing Metering Dispensations and non-Standard BM Units
(BMU) that could identify the need for lifetime or generic Metering Dispensations and lead to a reduction
in future Metering Dispensations and non-Standard BMU Applications; and
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252/13 – SCOPE FOR REVIEW OF MARKET ENTRY, EXIT AND
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METERING DISPENSATIONS AND NON-STANDARD BMU
●
Consider reviewing the Codes of Practice (CoPs) if ELEXON’s review of dispensations and BMUs identifies
issues or opportunities for improvement.
3.2
In 2014/15, ELEXON reviewed and implemented changes to the processes for raising and processing
Metering Dispensation applications. Despite these improvements, the Panel remains concerned at the
numbers of Metering Dispensation applications raised by Parties. This is particularly in light of the growing
numbers dispensations and non-standard BMUs that Parties have requested for sites being configured and
re-configured to accommodate mid-sized renewables and the redevelopment of old generation sites, e.g. to
participate in schemes such as the Electricity Market Reform’s (EMR’s) Capacity Mechanism or Contracts for
Difference.
3.3
This review will be a review in accordance with BSC Section C3.8 (a BSC Review). ELEXON must complete
such a review at least once every two years and not more often than once every year.
3.4
Bearing in mind ELEXON’s other operational activities and subject to detailed planning and resourcing, we will
use our reasonable endeavours to complete the review within 5 months. ELEXON will produce a report
containing observations and recommendations. We aim to present our report to the Panel at its October 2016
meeting. The Panel will then have the opportunity to consider whether to initiate a programme of work to
implement the review’s recommendations.
3.5
The proposed context, objective, scope, workstreams and deliverables for this review are set out in more
detail in Attachment B.
4.
Recommendations
4.1
We invite you to:
a)
APPROVE the scope for the Review of Market Entry, Exit and Qualification arrangements
b)
NOMINATE a Panel Sponsor for the Review of Market Entry, Exit and Qualification arrangements
c)
APPROVE the scope for the Review of Metering Dispensations and Non-Standard BMUs
d)
NOMINATE a Panel Sponsor for the Review of Metering Dispensations and Non-Standard BMUs
Attachments
Attachment A – 252/13a - Scope of Review of Market Entry, Exit and Qualification arrangements
Attachment B – 252/13b - Scope of Review of Metering Dispensations and Non-Standard BMUs
For more information, please contact:
Nicholas Rubin, Market Advisor
[email protected]
020 7380 4007
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