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The Data and Communication Company (DCC) has disagreed with regulator Ofgem’s proposal to trim £11.7 million of “unacceptable” forecasted costs which would otherwise be passed on to users of the network.
The DCC said in its response to Ofgem’s consultation on the DCC’s price control submission for 2014/15 that overall it is pleased with Ofgem’s proposal to accept changes to its external costs as being “economic and efficient”. Its latest total cost forecast is £1.996 billion for its licence period up to 2026.
However it disagrees with Ofgem’s findings that it did not provide enough justification for the additional £11.7 million, saying “we made great efforts to produce a clearly structured and high quality price control submission for RY2014/15.
“We reported in considerable detail on how the dramatic changes in the DCC programme have impacted the evolution of our costs.”
Ofgem concluded that the additional £11.7 million, including almost £7 million for third party contracts, would not deliver value for money, despite acknowledging that “a number of changes” have meant the DCC has incurred additional costs since the business plan was agreed.
The DCC has also disagreed with Ofgem’s decision to strike £0.409 million from the DCC’s internal costs last year which it said is “unacceptable”.
Ofgem said: “The quality of DCC’s service is of paramount importance to the smart metering programme.
“However it is important that we ensure these services are provided in an economic and efficient manner.”
A consultation on the DCC’s intended charging statement for users of the network will close on February 4.
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