What are the Maximum Demand changes and how will your business be affected?
Maximum Demand meter changes (or P272 legislation) was approved by Ofgem in October 2014 and will affect all businesses with an 05-08 profile Maximum Demand meter.
If you’re not sure what type of meter profile you have, just take a look at your MPAN number (located on your bill or meter) and see whether the number circled below is 05, 06, 07 or 08:
If it is, your business has a Maximum Demand meter and you’ll be affected by the P272 legislation changes.
Why is this happening?
The aim is to make billing more accurate, allowing suppliers to better monitor businesses with high energy usage.
Ofgem believes that by measuring the Half Hourly usage data, costs will then be more accurately reconciled between consumers and suppliers, and suppliers and generators.
It is estimated that this change will affect 160,000 05-08 meters across the UK, requiring that they are settled half-hourly by 1st April 2017 when P272 legislation comes into effect.
Despite the fact that you pay suppliers for your electricity, it is actually delivered, via the supplier, to your area by the Distributor Network Operator (DNO). The data that will be gathered as a result of the changes will tell the DNO how much energy they need to supply and it will help suppliers to buy energy more effectively – which will hopefully help make your bill cheaper.
What does this mean for you?
If you currently use an 05-08 meter, then you’ll be subjected to increased charges when your meter is re-profiled due to the P272 legislation. This is mostly because all HH meters have a Meter Operator Agreement (MOP) and a Data Collector (DC) for each supply, the cost of which tends to be rolled into your final bill but not included within the actual rates.
You will also have to pay a monthly capacity charge for the KVA level allocated to your supply. This is determined by the distributor measuring the Maximum Import Capacity (MIC) of your property and working out your peak energy usage. The charge is the result of you having to pay for the availability of your peak usage.
Sound complicated? Don’t worry, it is – but not to us.
We will make sure that you can take advantage of the benefits arising from the P272 legislation. Half Hourly meters give a clearer picture of your energy consumption so we can help reduce your costs by managing how and when you use the most energy.
We’ll help make sure you have full visibility of your peak usage so you’re in a better position to control your consumption and potentially reduce your bill as a result.
When will these changes occur?
This will depend on your supplier but the deadline set by Ofgem is 01/04/2017. Most suppliers have already started making the changes.
Your existing contract rates will probably be honoured but when it comes to renewing your contract there’s going to be a lot more to consider and it can be a minefield establishing whether or not you’re making the right decision – this is where we can provide invaluable help and advice.
Our experienced Black Sheep energy consultants will be on hand whenever you need us. If you decide to switch with us you’ll have access to our years of experience, market-leading prices and excellent supplier relationships – we’ve got your interests at heart so we’ll make sure you secure the fairest deal despite the changes.
Simply book an appointment with one of the team and let us find the best deal for you.