Letter on industry role in creating market conditions necessary to support realisation of the benefits of smart metering
Correspondence and other
Publication date
Industry sector
Supply and Retail Market
This letter sets out Ofgem’s expectations on industry to help create the market conditions necessary to support the realisation of the benefits of smart metering. The importance of industry’s role has been highlighted by Balancing and Settlement Code (BSC) Modification Proposal 272 (‘P272’) and related changes to the Distribution Connection and Use of System Agreement that seek to develop new half-hourly Distribution Use-of-System (DUoS) tariffs for Profile Classes 5 to 8.
Ofgem is committed to maximising the benefits for consumers from the roll-out of smart metering. However, we are concerned by the lack of co-ordination between industry parties - suppliers and electricity distribution network operators alike – which is hindering the timely consideration of code modifications, the consideration of cross-code issues and delaying the realisation of these benefits for consumers. We consider that industry has a responsibility to develop code change in a co-ordinated way as far as is possible.
We have signalled in a letter to the BSC Panel today that we expect industry to take steps in order that our decision on P272 can take account of changes to DUoS charging arrangements. However, in light of the lack of co-ordination between industry parties, we are also considering in parallel whether new licence conditions or other measures, including a Significant Code Review, are necessary to ensure licence holders facilitate the realisation of the long-term benefits of smart metering.