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Dept of Trade and Industry

Answer

Mr. Colman: To ask the Secretary of State for Trade and Industry what work has been undertaken with Ofgem in the past year to ensure administrative arrangements under the New Electricity Trading Arrangements are fully accessible to smaller generators as highlighted on the Sustainable Energy Policy Network website; and what assessment she has made of how effective these measures have been. [182009] Mr. Timms: Both the DTI and Ofgem have been involved in a number of initiatives aimed at improving the position of smaller generators. With regard to the Balancing and Settlement Code, Ofgem has considered and approved a number of modifications. For example, a revision of the definition of the System Buy and Sell Prices has significantly reduced the spread of imbalance prices and thus the risk to which smaller generators in particular are exposed. Modifications have also been made to National Grid Transco's charging methodology, which now allows "embedded benefits" to be paid directly to generators in certain circumstances, which again will particularly benefit smaller generators. In this area, it is primarily the role of the Balancing and Settlement Code Panel to assess the impact of measures, and for industry participants to bring forward modifications to the code if they are considered unsatisfactory. In the context of the future British Electricity Trading and Transmission Arrangements, the DTI and Ofgem have recognised the special position of smaller generators through the provision of a discount for small transmission-connected generators in Scotland. More generally, the Distribution Commercial Forum, which is facilitated by Ofgem, is responsible for assisting industry participants in improving the governance framework of the existing distribution connection and use of system arrangements. The Distribution Generation Working Group--jointly chaired by Ofgem and DTI--is looking at ways in which the barriers to the connection of smaller-scale generation can be removed, and their contribution to the system in terms of losses, contribution to security and other embedded benefits can be fully recognised. Both of these forums therefore play assessment roles vis-a¬-vis the position of smaller generators.

Secondary information

Type

Written question

Reference

182009; 423 c668W

Session

2003-04

Subjects

Electricity generation Ofgem Electricity Markets Power stations Generators

Link

View this Written question on www.publications.parliament.uk