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The Energy Networks Association (ENA) has laid out a set of prescribed points that developers must hit, or risk losing their connection to the distribution network, in ongoing efforts to release unused capacity and avoid costly network reinforcement.
These milestones would allow distribution network operators (DNOs) to withdraw and reallocate capacity to other potential connecting customers when the capacity is not being, and is unlikely ever to be, used by the current customer holding the connection.
Customers would be required to hit the prescribed points during the development of the asset being connected, or risk losing the connection.
A consultation is due to be held in March. The ENA will then report to Ofgem with a proposed plan to enact the agreed principles and milestones by end of June 2016.
The ENA is also investigating methods of allowing DNOs to withdraw capacity from new connections that do not contain milestones, and is due to report on its findings in September this year.
Ofgem called on DNOs to complete a set of actions, of which the milestone proposal is one response, set out in its plan in September 2015 to help use existing spare capacity more efficiently, in an effort to reduce the amount of reinforcement required for new users to join the network.
The actions include asking DNOs to publicise the various options that could potentially lower the cost of the connection for developers, such as flexible connections and spreading the cost of the reinforcement amongst a consortium of customers.
Ofgem said it “welcomes the progress that has been made by DNOs and other stakeholders” against its directions but said “in some areas further work is required”.
DNOs have also put forward six proposals for schemes that will serve as trials for anticipatory investment.
Ofgem said: “We wanted to use these ‘real-life’ examples to understand what might be possible under current regulations and legislation. We hope that these examples will help to establish models that can be employed across the industry.”
Ofgem said it will publish “periodic updates” on a trial-by-trial basis to share the learnings.
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