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Document Number CLNR-L087

Date Posted 21-Jan 2015

April 2010 Tariff Reform Analysis; Introduction to the Common Distribution Charging Methodology (CDCM)

Overview

This report contains the results of an investigation into the impact of the Common Distribution Charging Methodology (CDCM) on 2054 Industrial and Commercial (I&C) customers from across the Northern Powergrid network areas.

This Distribution Use of System (DUoS) tariff implementation has been designed to unify the charging procedure for HV and LV customers. Ofgem’s 2008 document did not provide a specific request to implement such a scheme; therefore the move has been made as a voluntary consideration by the DNO groups.

The data made available for analysis covers the period (01/03/2009-20/04/2011) and therefore details energy consumption for one year prior to and post introduction of the tariff in April 2010.

Real power consumption data from the North East and Yorkshire areas has been examined, in order to determine if there has been a significant shift in demand in coordination with the new DUoS charges. The CDCM methodology details three ‘time bands’ which reflect periods of network loading. If the network has a high probability of peaking, customers are incentivised to reduce their demand by high DUoS charges and vice versa; these conditions relate to the ‘Red’ and ‘Green’ periods respectively.

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