Decision on Changes to Capacity Charging Methodology
In 2016 the Utility Regulator for Northern Ireland (UR) hosted a public consultation on the Electricity Distribution and Transmission Connection Policy. It was recognised that getting connected easily and at a fair price is important for both demand and generation customers and it is important that other network consumers only pay what is necessary for their energy. It was believed that the lack of capacity on parts of the network is presenting challenges for new customers getting access to the distribution electricity network.
In their follow-up publication, ‘Next Steps’, published in April 2017, the UR identified that the recovery of unused capacity was a key factor in facilitating access to new users. NIE Networks was requested to consider the incidence of underutilisation and to develop appropriate and proportionate measures to release capacity if it is being persistently underused.
Call for Evidence
Consequently, in August 2018 NIE Networks launched a 'Call for Evidence' (CfE) which was to gather stakeholder views on how this request should be addressed and specifically considered how NIE Networks may release unused capacity to facilitate better utilisation of the network and lower connection charges for new applicants and existing customers wishing to increase their demand.
In answer to our 2018 CfE, NIE Networks received three responses which provided a meaningful insight on stakeholder views and have helped influence how we have taken forward the next stage of the consultation on the Maximum Import Capacity (MIC). We took into account the feedback received which has led us to take additional time to undertake the further analysis required to address points raised by responders. In response to the stakeholder feedback we specifically modified the proposed methodology for both MIC and exception charging and in particular, how we are to keep affected customers informed throughout the process.
Consultation Paper
In January 2020 we then published a consultation paper on the revised proposals. We received five responses to this consultation which provided helpful feedback and insight into stakeholders’ thoughts on the proposed changes to the MIC charging methodology. Responses highlighted the importance of communication and engagement for customers and suppliers and provided a level of support for the proposed changes.
Decision Paper
Having taken the consultation responses into consideration, and following subsequent discussion with the UR, NIE Networks has decided to proceed with implementing the changes proposed in the consultation paper to MIC charging and MIC exception charges. The decision paper provides an overview of the stakeholder responses and sets out the details of the changes that will be implemented.
These changes will be implemented using the two stage phased approach, with Phase 1 taking affect from October 2021 for EHV & HV customers and Phase 2 in the following tariff year for the remaining customers.
Update on MIC Charges for LV Customers (June 2022)
We have decided to postpone the introduction of MIC charges for LV customers until October 2023 (instead of October 2022). This means that CSC charges will continue to apply for LV customers during the 2022/23 tariff year. This delay will allow a further year for LV customers to recover to more reflective pre-Covid levels of business outputs and electricity demand, before facing the changes to how capacity is charged.