Why do you require copies of my bills?
In order to provide you with easy to read cost comparisons, we will input your current data into our cost comparison spreadsheets along with the costs from those energy companies tendering for your business. This will help us advise you, to enable your decision making process to be easier and more informative.
Why do you require a letter of authority?
Due to the Data Protection Act, we will need you to sign a letter of authority in order to obtain all the necessary information from your current supplier. Typically this includes contract end dates, energy consumption and the rates being paid. Please note that our letter of authority stipulates that we are not authorised to sign contracts on your behalf!
What is termination?
The terms and conditions of your existing energy contract will include the termination requirements of your current supplier. In order to avoid your current supplier rolling you into another contract at a rate that may be unfavorable, you need to provide a termination notice. THIS DOES NOT CUT OFF YOUR SUPPLY but merely enables you to choose your next supplier without fear of your contract being rolled over. We will issue a termination notice as part of our management service.
I have been told I need a Half Hourly meter, is this necessary?
Industry regulations state that any premises with a maximum demand of at least 100kW are equipped with metering that is capable of recording their consumption every half an hour. Your supplier would be in breach of their license to supply if they failed to ensure that such metering was installed. If you do not install such metering, your supplier will arrange this on your behalf and pass on the charges to you – potentially with an additional administration or handling charge added on.
How Can I benefit from a Half Hourly meter?
A half-hourly meter records electricity consumption for every half hour period throughout the day. The data is then automatically retrieved by a communications link for billing and industry settlements. It means that your bills will be based on accurate readings, as opposed to estimates, and gives you the opportunity to receive additional energy management services.
My supplier is talking about Availability, what is that?
Availability is the limit of capacity if your usage hits Maximum Demand. Consumers pay a fee per unit based on their capacity. For example, if your site has an Availability of 150 kVa then the Maximum Demand figure should not exceed that figure at any time.
What is Half Hourly data?
Half-hour Data (HHD) is the product of the Half Hour Data Meter. The data is usually made available to end users on a spreadsheet. A full year’s half hour data will be a spreadsheet made up of 17,520 data cells. This data is essential if you require competitive quotes when your contract is coming towards its end date.
Some common electricity terms and wording explained:
The Unit Price
The unit price refers to the price per unit of energy. There are three elements which make up your electricity unit price:
This is the cost of the electricity purchased on the wholesale market to cover your predicted future usage. It is the single biggest component of the unit price and accounts for between 60 and 80% of a business’ total bill. In the industry, this element is called Energy at NBP (Notional Balancing Point).
These relate to the costs of providing the infrastructure required to deliver your power. They include the cost of energy lost (as heat) as it travels from the power station, through the transmission and distribution wires to you. These charges are referred to as transmission Loss (Tloss) or Distribution Loss (Dloss). They also charge for using the transmission and distribution networks; referred to as Transmission Use of System (TUoS) and Distribution Use of System (DUoS). You may also have a separate agreement with an external electricity distribution company. This means that you will be billed for TUoS and DUoS by this company. This charge will therefore not be included on your electricity bill. National Grid charges electricity companies to recover the costs incurred through balancing the system through Balancing System Use of system (BSUos) charges. This cost is included in the price you pay, and currently accounts for approximately 1% of your total bill.
Cost to serve
These are the costs that your chosen supplier incurs as your supplier. These include the costs of maintaining IT systems; paying staff that manage your energy accounts; and the risks involved with your predicted consumption versus your actual consumption, which is called imbalance risk. This typically accounts for only a small part of your total bill, usually around 2%.
Pass through charges
On your bill, you will also see other charges for costs that the electricity industry incurs in delivering your energy. We call these Pass through charges and, where applicable, they are referenced in quotes, and itemized on your bills. The main ones are explained below:
This contributes towards the installation and maintenance of the electricity distribution network, and the distributor’s administration cost. It is calculated over the billing period at either a fixed monthly rate, or daily rate. The rate reflects the costs of the local distribution company.
Availability Charge (sometimes called Capacity Charge)
This charge covers investment and maintenance of the electricity network. Customers are charges a fee (per unit) according to the agreed capacity for that site.
Reactive Power Charge (KVAR)
Reactive power refers to the difference between the electricity supplied and the electricity converted into useful power (i.e. that which you are able to use). If a site has high Reactive Power i.e. if there is a large amount of power being wasted, more current needs to flow to provide the same output. This puts an additional strain on the distribution network, potentially increasing costs for the Distribution Network Operator. This charge is a contribution towards those costs.
Combined Half Hourly Data Charge
If you have a Half Hourly (HH) meter, this charge reflects the costs associated with collecting and handling your metering data.
Settlement Agency Fee
Behind the scenes distribution companies, suppliers, metering companies and others need to reimburse, and recover their costs from one another. The UK’s Balancing and Settlement Code Company, called Elexon, maintains the system which governs this activity. This relates to the cost they charge for doing so.
The Renewables Obligation (RO) is the main support scheme for renewable electricity projects in the UK. It places an obligation on UK suppliers of electricity to source an increasing proportion of their electricity from renewable sources. The RO accounts for approximately 2% of the total bill.