P272 Explained – What is it?
The P272 is an amendment which has been proposed to the balancing and settlement code, which defines the rules of the balancing of electricity in the UK. The amendment will result in the requirement for Half Hourly settlement of all meters in the profile classes 05-08.
In the name of upgrading the electricity market, the P272 is aimed at businesses who are currently operating under the Maximum Demand (MD) metering system and their transition to an Automated Meter Reading (AMR) system.
When is the P272 Deadline?
Originally proposed in 2011 and after several modifications, P272 was approved by OFGEM in Oct 2014 stating that the deadline for the switchover to HH settlement is on April 1st 2017.
The P322 has been put on a fast track for implementation and will commence August 2015 which provides new arrangements for the migration of sites which have AMR meters installed into HH settlements.
How will this affect you?
P272 is an industry change and means any business with metering profiles of 05, 06, 07 or 08 will need to go through a Change of Measurement Class (CoMC) to Half Hourly Settlement. Depending on your patterns of usage, moving to a HH Settlement means different charges will appear on your bill and could involve cost increases or decreases.
However, if the P322 gains approval, those consumers already under will not begin to witness changes until the expiry of their contract – only if the expiry date is beyond November 2nd 2017. Many suppliers have already begun offering new quotes for all concerned customers who are HH settled.
The P272 change aims to provide businesses with bills that are based on more accurate data.
What will change?
The P272 will see the introduction of new contractual costs. It will reflect electricity rates that should be much more representative of market rates.
Users who are currently settled by profiles already have meter installation, maintenance and reading costs included in their bills, meaning they don’t require addition meter charges or side contracts.
How will it benefit you?
Metering data in Half-Hourly intervals ensures your electricity bills will be more representative of your site’s actual power consumption, meaning you will be able to more accurately match your tariffs to your actual usage.
The enhanced accuracy of the data allows for the more efficient and flexible management of energy. Using HH data, the more advanced suppliers with the ability to forecast demand will be in a better position to reduce supply costs and overall operational costs.
P272 – You have a choice!
One of our clients have a portfolio with approx. 50 x sites that have electricity meters with 05 – 08 profiles that will fall into P272 and will therefore require MOP and DC contracts.
If they were to choose to simply go with the current suppliers preferred MOP/DC (NOTE – this will also be the case if you choose not to source your own contracts) then they will be looking at total (MOP &DC) costs of approx. £665 – £750 per annum per site.
If you were to source your MOP & DC via TED we can look to procure contracts for approx. £ 267 per site per annum.
If we look at this for the 50 x sites that will be affected this is a saving of at least £400 per site per year when compared to standard agreements via suppliers!
Therefore potential savings per year is approx. £400 x 50 = £20,000.
£20,000 x 5 years (standard agreement term) = £100,000 savings!
How The Energy Desk Can Help With P272 Regulations
We offer market leading prices on HH metering services.
We provide bespoke contracts tailored to your business needs. Our experts provide specialist analysis on supplier’s offerings then use their knowledge to source the most suitable contract for you.
Your bills become more complex because they will be based on your actual electricity consumption and will more often than not include itemised non – commodity costs. We will eradicate any errors when we analyse your invoices, saving money for your business.
Monitoring Data, Metering and Cost Reduction
Here at TED our dedicated team of metering experts can help you visualise the new rich meter data, which will enable you to know exactly what you consume and when to capitalise on energy saving opportunities.
Get in touch with TED for more information
If you’re worrying about the effect the P272 amendment might have, The Energy Desk are a leading energy broker with a dedicated team who can help you with your P272 worries and inform you about the implications it could have on your business.
If you have any questions regarding any of our services here at TED, don’t be afraid to get in touch today. Call the TED team today on 0845 838 9830 or fill in our online contact form and we’ll get back to you as soon as possible.