Theft Best Practice Forum Minutes 17 January 2019 at 10:00 Amba Hotel Charing Cross, The Strand, London WC2N 5HX Attendee Company Daher Aden [DA] Bristol Energy Ruby Currie [RCu] British Gas Piers Merritt [PM] British Gas Andy Channing [AC] EDF Energy Lucy Watson-Smith [LWS] Robin Hood Energy Jennifer Pickering [JP] E. ON Energy Ash Sherratt [AS] E. ON Energy Mike Wilkinson [MW] Npower Matthew Simkiss [MS] Npower Shamil Udayar [SU] Npower Ross Clarke [RCl] Npower James Scafie [JS] SSE Claire Cantle Jones [CCJ] SSE Sarah Perriam [SP] SSE Sarah Mcdermott [SM] SSE Charlotte Williams [CW] SSE John Sanderson [JS] First Utility Tracey Burton [TB] Co-operative Paul Hart [PH] UK Power Networks Jack Brayshaw [JB] BES Utilities 24 January 2019 Page 1 of 16 In Attendance Austin Gash [AG](Secretariat) ElectraLink Michelle Simpson [MS] (Chair) ElectraLink Fungai Madzivadondo [FM] (Secretariat) ElectraLink Mark England [ME] (part meeting) Experian Jon Dixon [JD] (part meeting) Ofgem Apologies Company Ian Main Scottish Power Dave Ackers Xoserve Dave Mitchell SGN Hayley Berry SSE Emma Hegarty SSE OPEN SESSION 1. Introductions 1.1 The group noted the introductions. 1.2 The Chair provided an overview noting that the Forum seeks to improve Supplier engagement and help industry participants develop and share knowledge of general theft arrangements. 2. Last Meeting Minutes 2.1 ElectraLink received minor comments regarding the September Theft Best Practice Minutes. The updated meeting minutes were circulated to members prior to the meeting. There were no further comments provided during the meeting. ElectraLink took an action to amend the September 2018 meeting minutes and upload to the SPAA and DCUSA Websites. 24 January 2019 Page 2 of 16 ACTION: TBPF _20190117/01: Last Meeting Minutes ElectraLink took an action to amend the September 2018 meeting minutes and upload to the SPAA and DCUSA Websites. 3. Actions Feedback – September Meeting 3.1 The Chair noted that the September Forum actions had been circulated prior to the meeting however given the number of documents issued it was worth running through all actions to provide a complete update and address questions from the group. 3.2 For action TBPF/20180605/07 - ElectraLink to investigate the use of data flows to report instances of identified theft, it was noted that the SPAA Schedule 33 report had been shared with the Allocation of Unidentified Gas Expert (AUGE) and gaps have been found when comparing against other data sets, such as TRAS data and Joint office reports. ElectraLink has been engaging with the Xoserve and the Joint Office to help determine a solution to improve the current Supplier and Shipper reporting processes. The Chair advised that a proposal to set up a joint Working Group will be put to the UNC and SPAA panels in January. 3.3 Against action TBPF/20180605/12 for ElectraLink to speak with Elexon to find out if Suppliers are reporting lost electricity units into Elexon and consider possible changes to the reporting processes, it was highlighted that the issue was previously discussed at an Issues Group however no progress has been made on if the requirement to report lost energy units should be changed. A member of the group suggested a possible mechanism which could facilitate the use of the TRAS data for settlement reasons. ElectraLink took an action to take this question back to the Theft Issues Group (TIG). ACTION: TBPF _20190117/02: TBPF/20180605/12 ElectraLink took an action to take the below question back to the TIG: • Whether there is a possible mechanism which could facilitate the use of the TRAS data for electricity settlement purposes. 3.4 Against action TBPF/20180912/01 for The Theft Issues Group (TIG) to consider whether Crimestoppers should be granted access to Data Enquiry Service (DES), it was noted the Central Data Service Enquiry (CDSP – Xoserve) are unable to provide Crimestoppers access to DES. As an alternative Xoserve are looking at a customer website where customer account details can be checked to get the same information as DES. It was pointed out the only issue is that the system does 24 January 2019 Page 3 of 16 not include commercial data, Crimestoppers will therefore still need to send commercial tip offs to Xoserve for matching. 3.5 Attendees also suggested that this would be useful for Suppliers to use. The Chair advised that this was being looked at by the TIG. 4. Unsafe Situations Update 4.1 Against action TBPF/20180912/02, ElectraLink to discuss the reporting of unsafe situations and interpretation of ‘suspected’ to be discussed with the TIG, it was noted ElectraLink have had further discussions with the TIG, have contacted the relevant groups and are awaiting their response. It was agreed for this item to be carried forward to the next Theft Best Practice Forum in April. ACTION: TBPF _20190117/03: Unsafe Situations Update ElectraLink took an action to carry agenda item Unsafe Situations Update forward to the next Theft Best Practice Forum in April. 5. Improvements to the GTDIS Post Year 1 and General Q&A on Incentive Scheme 5.1 ElectraLink has carried out a review of Gas Theft Detection Incentive Scheme (GTDIS) Schedule 39 following the first year of the scheme and has discussed the following proposed improvements with the TIG. At the end of the GTDIS Year 1, the Scheme Secretariat (ElectraLink) carried out a lesson learnt exercise. The Secretariat presented the improvement areas to the Theft Best practice Forum for information and comment. 5.2 The TIG have been looking at the list of items which need to change prior to the commencement of the Incentive Schemes for 2019. Considering timings, the recommended changes will progress within an Urgent Change Proposal (CP) ahead of next scheme year. These changes will include the undermentioned: • Credit & Debit - Improvement to change wording to reflect whole numbers to be used for supply point market share • Individual Theft Targets - Improvement to change number of decimal places for rounding a target of less than one • Incentive Pots – Improvement to communication of the theft incentive scheme pot value prior to scheme year • Incentive Scheme Reports – Improvement to only include participating Suppliers in the monthly report 24 January 2019 Page 4 of 16 • Debit and Credits – An insolvent company is deemed to not be a ‘Qualifying Supplier’ at the end of the Scheme Year – legal advice sought. Improvement to be made to include invoicing timelines • GTDIS and ETDIS Items – Change to be implemented to reflect only the target to be reviewed annually • GTDIS and ETDIS Methodology Review - SPAA Section 2.11– Amendment that this will be published after SPAA EC approval. 5.3 The group noted there will be an end of year report going to the SPAA Board recognising there were many issues in the first year of the gas scheme, particularly around debits and credits for year one and setting targets for year two. 5.4 When calculating the final debit and credits for the gas scheme year one, ElectraLink encountered some issues regarding insolvent Parties and Supplier of Last Resort (SOLR). The Chair covered off some of the SOLR scenarios with the group which have been addressed ahead of the following scheme year. The group noted these scenarios have been clarified by SPAA’s legal advisors. 5.5 If acompany ceases trading during the scheme year they will not be included in the final debit and credit calculations as they are not deemed to be a ‘Qualifying Supplier’. Should a company become insolvent after the scheme year ends and before invoicing, they would be a ‘Qualifying Supplier’ and a debit or credit would be issued, and a debit may remain unpaid if there are insufficient funds in the insolvency. 5.6 The Chair provided an update on the Independent Review of the Theft Target Methodology. It states in the code for gas year three that the TRAS Service Provider will produce a methodology for setting the target. Experian’s proposal has been put forward to the Theft Steering Group (TSG), however, there has been discussions in both the Theft Issues Group and TRAS Expert Group around the fairness of scheme year two and three targets and whether the apportionment of the targets between the domestic and commercial sectors is equitable. 5.7 An accountancy firm, Moore Stephens has been appointed to complete the independent review. It has been agreed that the review will include whether the targets for gas scheme year two and three are fair and equitable, which includes a review of the Experian proposed methodology for gas year three. This has been approved by the TSG and Ofgem are supportive of the review. 5.8 A letter of engagement from Moore Stephens has been received and they should start the work week commencing 28 January. Moore Stephens findings will be issued to the TSG around early March to help them to make a decision to either accept or reject the methodology proposed by Experian for the year three gas scheme. Should the TSG reject the methodology put forward, the Code states to refer back to the previous methodology. Experian will not be producing a new methodology each year, as the licence states it should be a review of the theft targets each year and 24 January 2019 Page 5 of 16 not the methodology. The methodology will be fixed for three years onwards. The Chair pointed out that Moore Stephens will be looking at the electricity target apportionment also. 5.9 The Chair noted the methodology review will only be published to Suppliers after the SPAA EC and DCUSA Panel have approved it. 5.10 A member of the group asked the below question: Question: What should happen when a company merges with another, or is bought out? Response: The Chair agreed to clarify and circulate the answer to members.