DCP161 – Excess Capacity Charges
What is DCP 161 and will your business be impacted?
From 1st April 2018, DCP 161 will be come into effect. It is a change to excess capacity penalties for half hourly electricity supplies. This change will ensure that the additional costs that DNOs (Distribution Network Operators) can incur when customers exceed their available capacity (KVA) levels are recovered.
Under DCP 161, users who exceed their capacity will be charged an excess penalty rate which could be up to three times higher than the standard rate. The applicable rates will vary by region and voltage, with costs expected to be higher in areas where there is a higher demand for capacity. Depending on the consumption profile, if the supply regularly exceeds its assigned available capacity, this change could increase overall electricity costs by 2% or more.
To avoid usage exceeding capacity levels it is essential to understand the available capacity and maximum demand levels of these supplies. Any businesses that incur excess capacity charges will need to agree a revised capacity or take energy saving measures to reduce their maximum demand.
Why is DCP 161 being implemented?
To help DNO’s balance the usage in their networks better by encouraging customers not to over use either by managing load better or requesting the right level of capacity.
The charging methodology is being changed to penalise those who exceed capacity and from the 1st April 2018 businesses exceeding their maximum available capacity will be heavily penalised.
There is however an opportunity to avoid these punitive charges.
So what can you do?
Firstly it is important to understand what the supplies agreed capacity is.
If your contracts are due for renewal between now and April 2018, it would be prudent to negotiate capacity charges. You don’t need to have a renewal to change the available capacity
Check your energy invoices to make sure you are not already getting excess charges.
- If you are being charged and you cannot reduce your demand you will need to apply to the DNO for an increase (or even decrease if that is the case)
- Consider reducing peak demand usage to avoid triggering the excess – this may be about simply moving usage around. Half Hourly data will help identify these trends.
- If you are impacted by P272 regulations you will need to check with the existing supplier what the available capacity is being set at. This might not be evident until after the meter has been upgraded to HH and the first bill is available. You will then need to check future bills to see if this triggers excess charges.
If like most businesses you would rather focus on servicing your customer needs instead please call me on 0203 4340903 or email me at email@example.com and I can help you plan ahead and ensure you avoid expensive charges.