A new legislation that is being introduced, Ofgem's DCP161 will bring a penalty for energy consumers that exceed their capacity on half hourly (HH) meters.
The purpose of this legislation
Implementing from 1st April 2018, it could cost energy consumers as much as 90% more on their bill or 3 times the standard rate. Currently, there is no penalty for exceeding the agreed capacity, which means that if someone exceeds, the supplier only charges the excess use by the consumers Fixed Capacity Charge. This means there is no incentive for the consumer to regulate their capacity usage.
The main reason is to shrink the costs that were incurred upon DNO’s (Distribution Network Operators) when a consumer exceeds their available capacity levels.
How it works
The penalty rates will vary by region and voltage. The higher the demand by consumers in a region, the higher the charge. Moreover, these penalties would be out of the contract to encourage the users to not exceed their capacity. This would also increase the overall electricity costs by 1-2% depending on the consumers history of exceeding the KVA capacity.
What if your supply is changing from non-HH to HH?
All the changes in supply would be settled before the legislation comes into force. However, it is necessary that the maximum demand level and new capacity be understood as it may be possible that your supply is exceeding the available capacity levels.
We provide a 3-step solution just for you to avoid any penalties
- Get your free review, under no obligation – Get a hassle-free review from us by filling out the form below.
- Increase or decrease your KVA capacity. After the review, we will advise if you require an increase or decrease in your KVA capacity to run your business and assist with getting that done.
- Use energy saving measures. We can suggest ways in which you can save energy and avoid the heavy fine that may be applicable to you in the future.
Read more about Ofgem’s DCP161 here.