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C16 2018 19 Consultation C16 Report to Authority A report in accordance with standard condition C16 for 2020-21 Proposed revisions to the: Procurement Guidelines Balancing Principles Statement Balancing Services Adjustment Data Methodology Statement System Management Action Flagging Methodology Statement Applicable Balancing Service Volume Data 17th February 2020 | C16 Report to Authority 0 Contents Executive summary ........................................................................................................................... 2 Introduction ............................................................................................................ 4 Overview of C16 Process .................................................................................................................. 5 2020-21 Annual Industry Consultation Process ................................................................................ 6 Industry responses to the C16 consultation ......................................................... 13 Proposed changes to Procurement Guidelines 2020-21 ................................................................ 14 Proposed changes to BPS .............................................................................................................. 30 Proposed changes to BSAD ............................................................................................................ 38 Proposed changes to SMAF ........................................................................................................... 44 Proposed changes to ABSVD ......................................................................................................... 51 Revised C16 Documents ..................................................................................... 57 Appendix A: Procurement Guidelines detailed changes ................................................................. 58 Appendix B: BPS detailed changes ................................................................................................. 59 Appendix C: BSAD detailed changes .............................................................................................. 60 Appendix D: SMAF detailed changes.............................................................................................. 61 Appendix E: ABSVD detailed changes............................................................................................ 62 Appendix F: Response Pro-forma ..................................................... Error! Bookmark not defined. 17th February 2020 | C16 Report to Authority 1 Executive summary In accordance with Standard Condition C16 of its Electricity Key Dates: Transmission Licence, National Grid ESO has carried out an annual review of the C16 Statements. This report details National Grid ESOs Documents sent to correspondence with industry and the changes proposed for the Ofgem: 17th February 2020-21 annual C16 review. Expected Ofgem As a result of the industry forum, informal and official consultation, Decision: 23rd March changes are proposed to the following documents: 2020 • Procurement Guidelines C16 Documents Uploaded to NGESO • Balancing Principles Statement (BPS) Website: 29th March • Balancing Services Adjustment Data Methodology (BSAD) 2020 • System Management Action Flagging Methodology (SMAF) • Applicable Balancing Services Volume Data Methodology (ABSVD). The changes that are proposed to the documents this year relate mainly to the following areas: • Review of the Procurement Guidelines • Updates to services to ensure all are up to date • Updates to reflect changes as a result of BSC modification approvals of P371 and P354 • Increased clarity and transparency where appropriate National Grid ESO proposed the above changes via an industry C16 consultation document published on 13th January 2020. Industry responses to the consultation were requested by 18th February 2019. Responses were received from: • Drax Group Plc • Sembcorp Energy UK • Uniper UK Limited • In addition, we also received letters and a combined response to the Procurement Guidelines section, specifically related to the review of interconnectors commercial arrangements from ElecLink Limited, EirGrid Interconnector Designated Activity Company, Moyle Interconnector Limited, FAB Link Limited, Nemo Link Limited, National Grid Interconnector Holdings Limited and Britned Consultation Recommendation Summary Following the industry C16 consultation, National Grid ESO proposed changes to the statements in relation to the following: Updates to reflect P354 modification approval. BSC modification P354 was approved in June 2018, with implementation scheduled for April 2020, including the required changes to C16. As part of the annual review process, the ABSVD statement has been updated to reflect the required changes, further details can be found in Proposed Changes Section. Updates to reflect P371 modification approval. BSC modification P371 was approved in December 2019, with implementation scheduled for June 2020. As part of the annual review process, the BSAD statement has been updated to reflect the required changes, further details can be found in Proposed Changes Section. Addition of Intraday Trading limits and Network Transfer Capabilities to the Procurement Guidelines in relation to interconnectors. In parallel to the C16 consultation, National Grid ESO is conducted an interconnector consultation with the aim of seeking views on the GB arrangements relating to interconnector capacity reductions and more specifically the commercial arrangements between the System Operator and interconnectors. As a result of the outcome of this review, and responses received to the C16 informal consultation process, the Procurement 17th February 2020 | C16 Report to Authority 2 Guidelines statement has been updated as part of the C16 annual review to reflect the required changes, further details can be found in the Proposed Changes Section. General housekeeping amendments have been made to keep the statements current and relevant. Following industry consultation, National Grid ESO now presents to the Authority for consideration revised versions of the C16 Statements supporting the changes outlined above. These revised versions of the C16 Statements recommended for approval incorporate both the revisions originally proposed by National Grid ESO in the C16 consultation and the changes to these revisions as a result of the C16 consultation process. The final revised versions of the C16 Statements recommended for approval are included in the Appendices. The Authority is invited to review and approve the changes, if the Authority does not approve these proposed changes to the C16 Statements, the existing versions will remain in place. Subject to approval by the Authority, the proposed changes will become effective from 1st April 2020. If you have any questions about this document, please contact: Jamie Webb (in the first instance) or Hannah Urquhart Future Markets National Grid Electricity System Operator Tel: +44 (0) 7768537317 Email: [email protected] Please note consequential changes resulting from modifications to GB industry codes, stakeholder suggestions and upcoming Regulatory changes which are not captured here will be actioned either in future annual reviews, or individual statement reviews as appropriate. Colm Murphy Electricity Market Change Delivery Manager 17th February 2020 | C16 Report to Authority 3 Introduction 17th February 2020 | C16 Report to Authority 4 Overview of C16 Process The Review In accordance with Standard Condition 16 (C16) of its Transmission Licence, National Grid ESO is required to conduct an annual review of all licence statements, regular reviews of the methodologies and, if appropriate, to propose changes to these documents. The purpose of National Grid ESO’s annual review and consultation is to ensure that each of the applicable documents remains current by seeking industry views on any proposed changes. Proposed changes can only become effective if approved by the Authority. Changes As a result of this review, National Grid ESO is proposing changes to the following documents: • Procurement Guidelines • Balancing Services Adjustment Data Methodology (BSAD) • System Management Action Flagging Methodology (SMAF) • Balancing Principles Statement (BPS) • Applicable Balancing Service Volume Data (ABSVD) These changes are primarily related to: • A review of the Procurement Guidelines • Changes to ABSVD as a consequence of the approval of BSC modification P354 • Changes to BSAD as a consequence of the approval of BSC modification P371 • Housekeeping A workshop was held on 5th November 2020, to gather stakeholder views on proposed changes and suggest new potential changes to the C16 documents. Following the workshop an informal 2020-21 C16 consultation process was launched ahead of the formal consultation in response to feedback received during the 2019-20 process. Information on this can be found in Section 2. Please note that the changes proposed will go-live from the 1st April 2020. Please note consequential changes resulting from modifications to GB industry codes, stakeholder suggestions and upcoming Regulatory changes which are not captured here will be actioned either in future annual reviews, or individual statement reviews as appropriate. 17th February 2020 | C16 Report to Authority 5 2020-21 Annual Industry Consultation Process C16 Stakeholder Workshop prior to informal Consultation The external workshop was held on 5th November
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