Consultation on RIIO-ED1 customer service and connection incentives
Consultation
- Upcoming
- Open
- Closed (awaiting decision)
- Closed (with decision)
Publication date
Closing date
Industry sector
Distribution Network
Decision
Dear Stakeholder,
Earlier this year, we decided what outputs each electricity distribution network operator (DNO) needs to deliver during the next price control period (RIIO-ED1). 1 We also identified the incentives that we will use to motivate DNOs to deliver these outputs. 2 In our RIIO-ED1 Strategy Decision we said we would consult on how the detailed arrangements for our customer service and connections incentives will work.
We are now seeking views on our proposals.
About customer service and connections
Customer service and connections are two of the six output categories that companies are required to deliver against under the RIIO price control framework.
In our RIIO-ED1 Strategy Decision we made it clear that we expect DNOs to provide high-quality service to all customers, including those who need new connections. We want DNOs to understand consumers’ needs and proactively engage with them to make sure these are met.
Customer service
To encourage DNOs to deliver good customer service, we are keeping the current Broad Measure of Customer Service but strengthening the associated incentives. The Broad Measure of Customer Service consists of three elements -
- a customer satisfaction survey (CSS),
- a complaints metric, and
- a stakeholder engagement incentive.
Connections
RIIO-ED1 also includes a package of incentives aimed at encouraging DNOs to provide a better service for customers connecting to the network. These include -
- a time to connect incentive, and
- an incentive on connections engagement (ICE).
What we are seeking your views on 3
In this consultation letter, we are seeking stakeholders’ views on the arrangements to determine the level of reward or penalty that DNOs will get under the customer service and connection incentives.
- In Appendix 1, we seek views on the arrangements for the CSS. Specifically, we are consulting on the target levels of performance, the approach to calculating penalties/rewards and how to penalise DNOs if customers are unable to contact them about a power cut.
- In Appendix 2, we seek views on our approach to setting the target and calculating the penalties for the complaints metric.
- In Appendix 3, we seek views on the arrangements for the time to connect incentive. Specifically, we are consulting on the target we set, the approach to calculating the reward, and how to split the reward across the different parts of the incentive.
- In Appendix 4, we seek views on how to split the penalty for the ICE, across each of the connection market segments.
These issues have been discussed with stakeholders as part of our RIIO-ED1 customer and social issues working group and our RIIO-ED1 connections working group. Information on other options proposed by stakeholders and the rationale for our ”minded to” position is set out in Appendices 1 to 4, alongside some detailed questions.
If you are unfamiliar with some of the statistical and regulatory terms we use in the consultation, please refer to Appendix 5.
Responses should be sent to RIIO.ED1@ofgem.go.uk by 30 October 2013. Unless clearly marked as confidential, responses will be published on our website. We will review consultation responses and issue a decision later this year.
If you have any questions about this consultation, please email us at RIIO.ED1@ofgem.gov.uk or phone us on 020 7901 1861.
Yours faithfully
James Veaney
Head of Distribution Policy
- The next electricity distribution price control, RIIO-ED1, will be the first to reflect the new RIIO model and will run from 1 April 2015 until 31 March 2023.
- RIIO-ED1 Strategy Decision
- Download appendices to this consultation.
Respond name
James Veaney