Charging arrangements

We have responsibility for ensuring that the Distribution Network Operators (DNOs) charge customers in an appropriate way for connecting to, and using, the electricity distribution networks.

This area sets out information about our policy, including the structure of charges project, and documents on policy work conducted thereafter.  We do not approve the charges themselves, but the methodologies used to calculate them.

We are carrying out two charging projects for both electricity distribution and transmission that aim to holistically review our approach to network charging.

The Targeted Charging Review (TCR): Significant Code Review (SCR) is an Ofgem-led project that was launched in August 2017. It assesses how residual network charges should be set and recovered in Great Britain for both electricity transmission and distribution networks. The TCR aims to address our concern that the current framework for residual network charges could lead to inefficient use of the network, leading to adverse impacts on consumers.

The electricity network access project, launched in November 2017 considers the reform of network access and forward looking element. We are focusing on options to define more explicitly arrangements for access to the networks and the options for improvement to the forward-looking elements of network charging.

The DNOs developed common approaches to connections charging and distribution use-of-system (DUoS) charging. These common approaches include:

  • from 1 April 2010, all customers connected at the lower voltages (all low voltage (LV) and most high voltage (HV)) have been charged DUoS under the Common Distribution Charging Methodology (CDCM)
  • from 1 April 2012, demand customers at the higher voltages (some HV and all extra-high voltage (EHV)) have been charged DUoS under the EHV Distribution Charging Methodology (EDCM)
  • from 1 April 2013, generation customers at the higher voltages have been charged DUoS under the EDCM
  • from 1 October 2010, the DNOs' connections methodologies have incorporated the Common Connections Charging Methodology (CCCM).

These common charging methodologies are set out in the Distribution Connection and Use of System Agreement (DCUSA) document. They can be modified through the DCUSA open governance process, in which we make the final decisions. We also make decisions on the form of the DNOs' charging statements.

The DNOs' charging statements can be found on the website of the Energy Networks Association. Charging issues are discussed by an industry group called the Distribution Charging Methodologies Development Group (DCMDG).

 

Publications and updates

  • Published: 17th Aug 2012
  • Closed: 2nd Oct 2012
  • Consultations and responses
  • 22 Associated documents
This is our consultation on the DNOs’ revised proposal for the EDCM for export, a charging methodology for higher voltage distributed generators.

  • Published: 19th Mar 2012
  • Decisions
  • 1 Associated documents
This letter addresses issues raised in response to our decision on 10 February 2012 regarding exemptions from use of system charges for “pre-2005” distributed generators.

  • Published: 10th Feb 2012
  • Decisions
  • 1 Associated documents
This letter sets out our decision with respect to a time-limited exemption from use of system charges for distributed generators that connected to the network prior to 1 April 2005.

  • Published: 3rd Feb 2012
  • Decisions
  • 1 Associated documents
This document sets out our direction to implement our decision to approve the methodology for Import Charges and delay the approval of the methodology for Export Charges in the EHV Distribution Charging Methodology (EDCM).

  • Published: 2nd Feb 2012
  • Decisions
  • 1 Associated documents
This letter sets out our decision that the DNOs are no longer required to use LRIC and FCP, to calculate a locational charge in the generation EDCM.

  • Published: 20th Dec 2011
  • Decisions
  • 1 Associated documents
Collective licence modification to clarify the charging boundary that determines whether Licenced Distribution Network Operators are charged in accordance with the correct charging methodology (CDCM or EDCM).

  • Published: 20th Dec 2011
  • Decisions
  • 1 Associated documents
This document sets out our decision on the timetable for modification of the Extra High Voltage Distribution Charging Methodology (EDCM) for export charges and the deferral of boundary changes for export customers.

  • Published: 20th Dec 2011
  • Decisions
  • 3 Associated documents
This document sets out our decision on the timetable for modification of the Extra High Voltage Distribution Charging Methodology (EDCM) for export charges and the deferral of boundary changes for export customers.

  • Published: 20th Dec 2011
  • Decisions
  • 12 Associated documents
This document sets out our decision to approve changes to the EDCM to comply with conditions set pursuant to standard licence condition 51A.21 and a direction to approve further changes to amend inconsistencies within the EDCM.

  • Published: 21st Oct 2011
  • Closed: 5th Dec 2011
  • Consultations and responses
  • 21 Associated documents
Consultation on how the Extra High Voltage Distribution Charging Methodology (EDCM) might be modified in light of a time-limited exemption for generators.

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