Open letter to domestic energy suppliers on the calculation of electricity base levelisation rates
Correspondence and other
- Publication date
- Industry sector
- Supply and Retail Market
This letter to industry sets out how the electricity base levelisation rates will be calculated and reconciled from 1 April 2024.
It explains how the reconciliation system operated by RECCo which supports the levelisation policy, has initially been designed to accommodate only one set of levelisation rates per region and fuel type.
It sets out our intention to derive a blended base electricity levelisation rate, and the methodology we will use to do this, whilst design updates are addressed in parallel to allow for single-rate and multi-rate metering arrangement differentiation.
It also details retrospective true-up process that RECCo will undertake backdated to 1 April 2024 to settle any differences in the reconciliation payments made to/ from suppliers under the interim blended rate solution.
The letter therefore requests that suppliers preserve data on the number of customers they have on single-rate and multi-rate tariffs for each payment type and each region on the 1st of each month, backdated to 1 April 2024, to enable this to take place.
A second version of the letter was uploaded on 15th March 2024 to correct a typographical error in Annex C. We identified that the prepayment meter blended rate for the North West region at the top of the table in Annex C was inadvertently not included when transposing the data in the original version, and subsequently the values for the rest of the regions were shifted up one place. This table has now been corrected in the letter and republished on the Ofgem website.