More on transmission charging for distributed generation

Report (73 pages, PDF) by Nigel Cornwall on transmission charging arrangements for embedded generation. This work was commissioned by Ofgem in connection with its current consultation on this subject.

The report provides an overview of the current GB electricity transmission charging arrangements for embedded generation. It finds them "arbitrary", and argues that this leads to "undue discrimination". It criticises a variety of possible charging methods, and recommends that in the short term National Grid "should should be invited to focus on establishing a more equitable and appropriate methodology for charging embedded generation on a causer pays basis", with new charges for overrun of access rights "however defined".

For enduring arrangements, the report finds "attractions" in seeking to pass on the problem to new "agents", whether DNOs or suppliers, who would arrange transmission access for generators. Further "exploration" of the firmness of access rights and whether charges should be for capacity or for usage is also found to be warranted.

The report also argues that 132kV lines should continue to be classified and charged for as transmission in Scotland, and that "there might be merit" in charging for 132kV distribution lines in England and perhaps 33kV in Scotland as if they were transmission.

For further information or advice please contact Franck Latrémolière.

Filed under Electricity, Ofgem.

Reckon LLP is an economics consultancy with expertise in data analysis, economic regulation and competition law.

About Reckon