Financing arrangements for DCC1 and DCC2 during Business Handover

This consultation is part of the DCC review programme, through which we are reviewing the regulatory framework for the Data Communications Company (DCC) to put in place new arrangements following the expiry of the Smart Meter Communication Licence in 2027 and appointing the Successor Licensee.

This is a combined policy and statutory consultation. It sets out proposals for modifications to the current SMCL and changes to the draft Successor Licence to ensure that both DCC1 and the DCC2 can recover necessary costs and to manage financial liabilities during the handover period. The proposals are primarily of technical nature, aiming to clarify the processes that both Licensees will be expected to follow.

We propose changes to the SMCL and draft Successor Licence to:

• allow DCC2 to recover Business Handover costs before the Transfer Date via DCC1’s Allowed Revenue
• enable DCC1 to recover costs for mandatory activities after the Transfer Date through DCC2’s Required Revenue
• clarify arrangements for transferring and ringfencing funds between DCC1 and DCC2 pending our final Price Control decision

We expect to publish our decision in December 2025.

Who should respond

This consultation is aimed at:

• Smart DCC (the current holder of the Smart Meter Communication Licence)
• DCC customers, including energy suppliers, distribution network operators, customer groups and other users of the smart metering network
• parties applying to be the holder of the Successor Licence
• organisations and individuals with an interest in smart metering policy and regulation

How to respond

Submit your response by 24 November 2025 to Jakub Komarek by emailing DCCregulation@ofgem.gov.uk.