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Issue 895 | CMP308 Removal of BSUoS Charges from Generation consultation

Issue 895 | CMP308 Removal of BSUoS Charges from Generation consultation

Josephine Lord Josephine Lord Consultant

1 Assessment & recommendation CMP308 Removal of BSUoS Charges from Generation was raised by EDF Energy in October and issued for its workgroup consultation on 5 April. It seeks to place the entire Balancing Services Use of System (BSUoS) charge on suppliers. Currently the charge is levied on generators and suppliers at an equal, non-locational volume-based rate. Interconnectors do not pay the charge as they are deemed to be transmission infrastructure. EDF Energy argues that the modification should be made in order to align the GB market with other European markets, where generators do not typically pay such charges. This would allow GB and continental generators to compete on a more equitable basis and remove the potential for BSUoS to distort cross-border trade. Ofgem set out proposals in December to change the way that BSUoS is charged as part of its minded-to decision for the Targeted Charging Review Significant Code Review (TCR SCR). This was to remove the BSUoS embedded benefit by changing BSUoS supplier charging to be on a gross basis rather than on net demand (less embedded generation). It also proposed that embedded generation should pay BSUoS for the first time. In addition, the BSUoS task force set up in December by Ofgem is due to issue its draft report imminently. This is considering whether elements of BSUoS could provide cost-reflective signals. Although Ofgem set out its view in December that CMP308 should not proceed until the task force conclusions were known, the proposer (with the CUSC Panel’s ...

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