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Categories
Regulation and policy
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Regulation and policy
Capacity Market prequalification
On 29 November, National Grid ESO in its role as EMR Delivery Body published the prequalification registers for the 2023-24 (T-1) and 2026-27 (T-4) Capacity Market (CM) auctions. In this week's 'Chart of the Week', we explore some of the highlights from the initial registers.
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Regulation and policy
Adjustments to the Energy Bill Relief Scheme
In October, the government announced a number of adjustments to the Energy Bill Relief Scheme (EBRS) for non-domestic consumers. In this week’s 'Chart of the week', we look at the impact of the maximum discount on those businesses that have been unable to fix their energy costs.
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Regulation and policy
T-1 Capacity Market 2023-24
The T-1 Capacity Market (CM) auction for Delivery Year 2023-24 will take place on 14 February 2023, during a particularly challenging period for the GB energy system with prices rising to unprecedented levels and concerns over security of supply. In this week’s ‘Chart of the Week’, we examine the range...
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Energy storage and flexibility
Sky-high prices in Dynamic Containment
In this week’s ‘Chart of the Week’, we explore the drivers behind the record high prices seen in the Dynamic Containment Low service in June, which saw individual assets accrue gross revenues of over £1mn, and consider the outlook for future service prices.
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Power and gas networks
UIG trends and reform options under UNC781R
Identification of Unidentified Gas (UIG) and its allocation has been a contentious issue for some time, there are a range of views across the gas industry on how it could be improved. In this 'Chart of the week', Hursley Moss discusses the recent trends of UIG and the possible reform...
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Regulation and policy
What’s the story…Oxera publishes findings on Ofgem’s regulatory performance
On 6 May, Ofgem published a report on the findings of an independent review undertaken by Oxera and commissioned by Ofgem's Board into the root causes of the recent supplier failure. In this 'Chart of the week', we look at how the report assesses the performance of Ofgem in meeting...
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Home supply and services
Last Resort Supplier Payments: the impact on domestic electricity bills
The presence of a significant increase in commodity costs in 2021, combined with the Default Tariff Cap limiting the revenues that suppliers can recover in the domestic market, has contributed to a number of suppliers falling into insolvency in the last 9 months. The Supplier of Last Resort (SoLR) process...
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Regulation and policy
“Behind-the-Connection-Point” A match made in heaven?
The AEMC's new rule change for storage integration into the NEM provides more flexibility for hybrid systems and VRE owners to more effectively level their bids and participation into the market. This means, if the new rule takes place, hybrids can manage their own internal energy exchange behind the connection...
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Low carbon generation
A podium finish: ROC banking in CP19
The Renewables Obligation (RO) Compliance Period (CP) 19 (2020-21) has been unusual in the scheme’s history in light of the impact of the COVID-19 pandemic. As we are in the so-called “compliance season” for CP19, we reflect on the last year and the importance that Renewable Obligation Certificates (ROC) “banking”...
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Low carbon generation
Australian Chart of the week | AEMO’s 2025 goal means that SA becomes the proving grounds
The latest news in the National Electricity Market (NEM) is AEMO’s goal to be capable of handling periods of 100% instantaneous renewables penetration by 2025. This is a significant challenge and fitting given the pace the NEM is moving to, supporting increasingly higher levels of instantaneous (and increasingly asynchronous) renewables...
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Low carbon generation
The outlook for private wire business models
Interest in private wire arrangements has grown in recent years, with the benefits of network and policy cost avoidance becoming a key incentive for generators to look at this development approach. In this Chart of the Week, we look at the expected evolution of cost avoidance over the next five...
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Low carbon generation
Australian Chart of the week | VRE pays more as PFR helps reduce coal FCAS costs
In our previous ‘Chart of the week’ in November 2020, we reviewed the increasing percentage of causer pays cost that solar generators bear due to their generation profiles and how this results in them paying significantly more of the causer pays cost as a ratio of the generation they provide. More than...
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Regulation and policy
Taking charge: the MHHS implementation levy
On 10 June the BSC Panel approved the Market-wide Half Hourly Settlement (MHHS) Implementation Charge for 2021-22. The new charge, introduced under modification P413 Market-wide Half Hourly Settlement Programme Manager, will cover Elexon’s programme management costs for MHHS implementation. It will be levied on suppliers on a monthly basis, based...
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Low carbon generation
Australian Chart of the week | Peak raise regulation FCAS volumes drop by 72MWs
It is helpful to understand Frequency Control Ancillary Services (FCAS) as FCAS price forecasts are needed to estimate generator and customer costs, as well as possible revenues for new and existing ancillary service providers. AEMO procures regulation FCAS to balance frequency during normal operation. From May 2019, AEMO has procured...
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Regulation and policy
Australian Chart of the week | EnergyConnect: transformational highway or white elephant?
Last week, the AER delivered their final regulatory approval for Project EnergyConnect (PEC) with total costs of $2.28b. This signifies the end of a process that began back in 2016 when the initial project specification report was released. There was some uncertainty around the viability of the project. However, a $295 million...
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Low carbon generation
Australian Chart of the week | “I feel the earth move under my feet”: from high to lows
We have seen a dramatic shift in FCAS price fortunes over the past year or so, going from all-time highs of ~$229.3mn in Q1 of 2020 (due to the separation event) to only ~$40.1mn in Q1 2021. Since 2019 we have also seen regulation raise prices decline from robust prices...
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Commercial and market outlook
Chart of the week | Getting the balance right – a new approach to policy costs?
A new report from research consultancy Public First has argued that the government should move the costs of energy policy from being heavily on electricity bills onto government expenditure. In this 'Chart of the week', we look at the four models for rebalancing put forward in the report. Options for...
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Regulation and policy
Chart of the week | Ofgem Switching Programme regains momentum
This 'Chart of the week' follows the seventh edition of Cornwall Insight’s Faster Switching Service (FSS), issued on Monday. Our FSS is designed to help readers understand Ofgem’s major industry programme to deliver faster and more reliable switching for consumers. The service comprises two elements: a walk-through of the entire...
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Home supply and services
Chart of the week | COVID-19 research findings published ahead of strengthened consumer protections
This 'Chart of the week' comes from Ofgem’s latest research on the impacts of COVID-19 measures on energy consumption and customer’s financial wellbeing. Published on 6 November, the findings presented come from the third wave of this research, with fieldwork being conducted in April, May, and October. While those reporting...
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Low carbon generation
Australian Chart of the week | One of these things is not like the others: FCAS separation value
Energy storage has been at the forefront of conversations resulting from AEMO’s newly released 2020 Integrated System Plan (ISP). The ISP states that 6-19GW of dispatchable resources are needed to support more than 26GW of new renewables. So where will battery energy storage fit in and where will they make...
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Energy storage and flexibility
Australian Chart of the week | Ramping: Brought into focus but always in the frame
With the release of AEMO’s Integrated System Plan (ISP) comes increased commentary on the need for power system services critical to ensuring the secure operation of the NEM. Of growing importance are services to provide voltage control and system strength, frequency control and inertia, ramping and dispatchability. In this week’s...
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Energy storage and flexibility
Australian Chart of the week | A little respect (just a little bit): FCAS costs hit solar hardest
Wholesale energy prices may have hit some of their lowest prices in years, but the total cost of Frequency Control Ancillary Services (FCAS) skyrocketed in Q1 resulting from the South Australian Islanding event. The islanding event threw back into the spotlight the importance of understanding the costs associated with FCAS...
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Energy storage and flexibility
Australian Chart of the week | | For a Few Dollars More: more markets proposed, not all survive
There are a mountain of rule changes currently before the Australian Energy Market Commission (AEMC), many of which will fundamentally change the manner in which the National Electricity Market (NEM) operates. In this Chart of the Week, we rate the impacts and probability of implementation of the rule changes being...
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Home supply and services
Chart of the week | Road to recovery: COVID-19 and the smart rollout
The full impact of the COVID-19 pandemic on the smart meter rollout is uncertain, although modelling from BEIS and Ofgem has provided early indications of future installation levels. In this week’s Chart of the week we compare these assessments against pre-pandemic expectations. With the introduction of social distancing and lockdown...
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Regulation and policy
Chart of the week | Back to the future: Non-compliance revisited
In this 'Chart of the Week,' we look at areas of the supply licence that have been subject to compliance engagement from Ofgem from 2017 to 2020. We focus specifically on recurring issues including the rules around protecting prepayment meter (PPM) customers, complaints, and treating customers fairly.
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Home supply and services
Chart of the week | Switcheroo: COVID-19 sees dates shift for Faster Switching
Like most industry workstreams, the Switching Programme has experienced a delay due to the reprioritisation of activities under COVID-19. This 'Chart of the Week' looks at how the programme had to slip to allow parties relief from its requirements.
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Regulation and policy
Chart of the week | The shifting sands of settlement
Ofgem issued its draft impact assessment and consultation on Market-wide Half Hourly Settlement (MHHS) on 30 April. The MHHS significant code review (SCR), which has been running since July 2017, aims to utilise the smart meter rollout and reform the electricity settlement arrangements. These reconcile the difference between how much energy a...
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Regulation and policy
Chart of the week | Ofgem’s plans revised due to COVID-19
On 16 April, Ofgem issued an online update on the re-planning of its priorities and workload over the coming months in light of the impacts of COVID-19. Please note that the deliverables presented in Figure 1 were not all necessarily due in April, rather this is to represent where we...
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Regulation and policy
Chart of the week | WHD and ECO thresholds now cover 98% of market
1 April 2020 will see the government’s Warm Home Discount (WHD) and Energy Company Obligation (ECO) scheme thresholds drop from 200,000 to 150,000. This will require all suppliers with more than 150,000 domestic customer accounts to be mandatory participants in these schemes. This week’s Chart of the Week looks at...
