Post: Ofgem “minded-to” delay TNUoS charging reforms

Ofgem “minded-to” delay TNUoS charging reforms

Energy regulator, Ofgem, has said it is “minded-to” postpone the implementation of the changes outlined in the Targeted Charging Review (TCR) until April 2023. If the delay goes ahead, energy users with half-hourly meters on their sites will be able to carry on avoiding part of the Transmission Network Use of System Charges (TNUoS), commonly known as Triads, by lowering their consumption at peak times for a year longer than previously planned.

In its letter dated 1 April, the regulator noted that while it intends to consult on its minded-to position, and impact assessment ahead of making a final decision on the reforms, it is unable to do so before the upcoming elections on 6 May.

To ensure stakeholders are able to better plan for the changes, Ofgem said it would delay the implementation of the reforms that would now come into effect from April 2023 rather than April 2022. This would be the second time Ofgem delays the reforms outlined in the Targeted System Review.[1]

What are TNUoS charges?

Energy consumers and generators pay Transmission Use of Systems Charges (TNUoS) to National Grid each year to maintain and upgrade the grid. These charges are made up of a forward-looking component and a residual component. The residual component is the part that half-hourly metered customers have been able to avoid paying by reducing consumption between 1 November – 28 February – the Triad period.

What is CMP343?

CMP343 (Transmission Demand Residual bandings and allocation (TCR)) forms part of the regulator’s Targeted Charging Review (TCR): Significant Code Review (SCR), which aims to reform the way that consumers pay for their use of the electricity network infrastructure.

Ofgem has already confirmed that it will press on with the reform to residual charges, a move positioned as an effort to spread costs more fairly between end users. The key change for I&C customers is that the residual charge element of TNUoS will be moved from Triad demand to a fixed pence-per-site-per-day charge based on available capacity.

Businesses with no Triad avoidance measures could see a cost reduction. But those that already have effective Triad-avoidance techniques in place will likely see costs increase once the new rules take effect. Overall, this reform will transform the way large demand customers pay for use of the electricity transmission network.

Learn more about the Triads and how they affect your business:

The Targeted Charging Review – What Does it Mean for Triads?

Triads Announced: GridBeyond’s was correct ion its forecasts

[1] In November 2019, Ofgem set Winter 2020/21 as the last Triad season, however, in April 2020 the regulator postponed their plans by a year