Annex 2
ACTUAL SUPPLIER CHARGES
| | £ million
|
| Service | Allowable Set up costs
| Annual operating cos
| Allowed charge per year
|
| PES Data Management 1998/20011 |
136 | 43
| 1119 |
| PES Data Management 2000/20052 |
227 | 29
| 74 |
| Supplier costs 2000-20053 | 113
| 14 | 37
|
| Pool | 725
| 106 | 19
|
| Scottish Settlement | 407
| 76 | 11
|
| Other4 | 15
| 8 | 11
|
| Total | 6038
| 68 | 152
|
Notes:
1 PES Data Management charges are included in distribution
charges. The annual charge level shown is price controlled. This
figure relates to the allowances made in 1998-2000.
2 This figure relates to the allowances made for 2000-05.
One third of costs have been transferred to suppliers, as meter
reading activity becomes a supplier responsiblity.
3 Supplier costs are estimated and suppliers may incur lower
costs depending on how they source meter reading services, Ofgem
has not been prescriptive in this area.
4 Other Costs include costs associated with the new Data
Transfer Service and the establishment and operation of the Master
Registration Agreement that are not covered under other headings.
5 Although Pool set up costs increased by 25 million, only
half of the increase from 59 million could be recovered.
6 Pool and Scottish Settlement operating costs are met by
both generators and suppliers 50/50 for the Pool and 30/70 for
the Scottish Settlement respectively.
7 Scottish Settlement set up costs are met 30 per cent by
generators and 70 per cent by suppliers.
8 Set up costs are normally recovered over a five year period.
Hence the allowed charge per year is calculated by (Set UP Costsx5)
+ Annual Operating Costs. The exception is the PES Data Management
Charges. These are recovered over a seven year period.
9 For 1999-2000 this was reduced by about £50 million
because of the delays in implementing market opening.
GENERAL
A note on the timescale of domestic electricity liberalisation
since 1998 and on any delays
The initial opening of the market took place on 14 September
1998 in accordance with the timetable established in January 1998.
Further areas opened as the local PESs's systems satisfactorily
completed testing. Southern Electric was the last PES to commence
opening its area (in January 1999) and, as a result, incurred
additional penalties under the price controls. Market opening
was completed in all areas in May 1999, one month ahead of the
planned date.
Coal, Fourth Report of Session 1997-98, HC 404: Energy Policy,
Fifth Report of 1997-98, HC 471: Government Response to Fourth
and Fifth Reports, CM 4071
1. In October 1997, the Committee decided to hear oral
evidence in December 1997 on the emerging problems in the coal
industry, as the end of the five year contracts signed in 1993
for supply of coal to the electricity generators drew near, and
as the attractions of gas as a means of generation grew. The December
1997 oral evidence coincided with the announcement of a moratorium
on consent for new generation plant. In March 1998 the Committee
took further evidence on the Environment Agency's January 1998
proposals for tighter controls on sulphur emissions. The Committee
reported in March 1998.
2. At the same time as deciding on the coal inquiry the
Committee had decided in principle to undertake a more general
inquiry into energy policy, covering a range of issues. On 22
December 1997 the Government announced a Review of Energy Sources
for Power Generation. The Committee held five sessions of oral
evidence, including one in Aberdeen, and reported in June 1998.
The Government announced the preliminary conclusions of its Review
in June 1998 and published its final Conclusions in October 1998,
together with Replies to the Committee's Reports.
3. The Replies were generally positive in tone, and some
specific recommendations were accepted, including information
to Parliament on consents given for new generating capacity, and
explicit recognition of safety as a priority concern. It did not
accept the Committee's doubts about continuation of the moratorium:
nor its recommendation for a formal presumption in long-term planning
that new nuclear plant might be required.
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