Excess Capacity Charges UK: Your DCP 161 101
- Author Shea Karssing
- Published April 3, 2018
- Word count 420
Excess capacity charges UK: Time is running out until the new DCP (Distribution Change Proposal) 161 legislation comes into force on 1 April 2018. The introduction of the Office of Gas and Electricity Markets (OFGEM)’s excess capacity tariffs will affect the electricity charges of many UK business.
What is DCP 161?
Under DCP comes the introduction of excess capacity penalties for entities that exceed their agreed capacity level. As soon as an organisation exceeds capacity level, they will be charged an out of contract rate - this could be up to three times higher than the current rate!
Why the change?
Under current legislation, organisations that exceed available capacity are not charged any penalties, only for the excess energy used. This means that, until now, users have never been incentivised to actively review their allocated capacity, putting strain on the system.
By charging customers for excess capacity levels, the DNOs (Distribution Network Operators) are able to recover the costs incurred when customers exceed their available capacity. Implementing these excess capacity charges will also help DNOs to better balance the usage of their networks.
What are the proposed excess capacity charges in the UK?
The excess capacity charge rates will vary by voltage and region - in areas with higher demands for capacity the costs are expected to be higher. There is a significant variance in excess capacity charges from region to region - with industry estimates between 49% - 177% for low voltage customers, and 13% - 165% for high voltage sites.
What about my electricity meter?
Companies with high energy consumption are now required to use smart meters (provided by energy suppliers) that provide a half-hourly (HH) measurement. The HH measurement is used to calculate excess capacity charge. Electricity meters that have been or are due to be converted to HH will be settled on the HH market in time for the introduction of DCP 161.
What can businesses do to avoid excess capacity charges in the UK?
Take energy savings measures to reduce your maximum energy demand
If your contract is up for renewal before April 2018, negotiate capacity charges now
Check that your agreed capacity level is set at an accurate level
Understand what your available capacity is, and what your maximum energy demand looks like
If you have a site which has only become half-hourly settled through the P272 process recently, take the time to ensure that the available capacity was set at a suitable level
If you can’t reduce your current demand, you need to apply to the DNO for a capacity increase
At Smarter Business, we work with our clients to ensure that their energy capacity is set at an accurate level. We can help you manage your usage and energy budget, as well as negotiate with suppliers on your behalf for tariffs and plans that best suit your business. Get in touch with an energy expert today.
Article source: https://articlebiz.comRate article
Article comments
There are no posted comments.
Related articles
- The Role of Lighting Stores in Brampton: Shaping Spaces for the Future
- The Role of Commercial Cleaning Services in Auckland: A Comprehensive Guide
- Exploring the World of Chauffeur Service: Benefits, Challenges, and Best Practices
- Nerds and Geeks: They still live on!
- IQ Tests: History, Uses, and Choosing a Reliable Resource
- 8 Great Ways To Teach Kids About Oral Hygiene
- App Development as a Catalyst for Business Growth
- Costs of arranging a Mortgage in Spain
- TikTok and Instagram: Ways you will grow and learn.
- Mustang GT: Ford Motor Company is a Rising Force!
- 10 Ways to Transform Production Scheduling in Business Central
- Elevating Your Home with Bold Decor and Vintage Carved Doors
- The Ultimate Skin Care Guide for Every Weather
- Do I Need Insurance When I Rent a Boat?
- Casino Bonuses: How to Maximize Your Rewards and Enhance Your Gameplay
- Was Joseph Stalin a good or bad leader of the Soviet Union?
- Top 5 Slots with the Highest RTP: A Winning Guarantee or a Myth?
- The Thrill of the Hunt Discovering the World of Location-Based Entertainment
- How Much Is the Hermès Cleaning Fee?
- Does Hermès Offer Free Repairs?
- The history of gun control in Australia
- Digital Marketing
- How to Mix and Match: Tips for Building Versatile Outfits from Your Wardrobe
- The Significance of Commercial Cleaning Services in Auckland: A Key Element of the Modern Cleaning Industry
- How RTP Impacts Online Casino Gaming: A Guide for Players and Operators
- How Authentic Employee Reviews Boost Employer Branding
- How to Choose the Best Online Casino: 5 Simple Steps
- Guaranteed Auto Financing
- Transform The Mudroom for The Festive Season
- Rustic Thanksgiving Ambiance with Farmhouse-inspired Doors