A significant code review
In August 2017, Ofgem launched a Significant Code Review (SCR) as the process to drive forward the Targeted Charging Review. The SCR was launched to address their concern that the current framework for residual and cost-recovery charging may result in inefficient use of the networks and unfair outcomes for consumers.
The Targeted Charging Review is looking at how electricity network residual charges should be set in future, for both transmission and distribution. The principles Ofgem are using to assess potential changes are:
1. reducing distortions
3. proportionality and practical considerations.
The Minded to decision
On 28 November 2018 Ofgem released its Targeted Charging Review (TCR): Minded to decision and draft impact assessment consultation. This minded to decision can be accessed on the Ofgem website. Following a consultation window, Ofgem are reviewing responses before they make a final decision sometime mid-2019.
To get a quick overview of the consultation, listen to the Lead Secretariat's Podcast in which we talk about the five key areas which Ofgem consulted on:
> Distribution and transmission residual charges
> The application of balancing services charges (BSUoS)
> The Small Generator Discount
> Transmission generation residual charge
> Balancing Services Charges Task Force
You can also watch the TCR Minded to decision webinar that the Lead Secretariat hosted with Ofgem on 11 December 2018, which gives an overview of the decision and draft impact assessment. The slides from the webinar can also be viewed here.