Ofgem fast-tracks proposal to prevent flood of meter readings

Ofgem has fast-tracked a proposed modification to the Uniform Network Code (UNC) that aims to prevent the central IT system for the gas grid from being deluged with an “unprecedented volume” of meter readings.

UNC700 was proposed by Russian firm Gazprom after the introduction of new arrangements for allocating unidentified gas created an incentive for gas shippers to submit meter readings more frequently.

Unidentified gas refers to any gas that flows through a local distribution zone that cannot be attributed to leakages, gas transporters or a supply point, for instance, due to metering errors or theft. Up until a few years ago, unidentified gas was lumped together with demand from non-daily metered supply points when attributing gas usage to customers.

But in June 2017, the central data services provider, Xoserve, implemented a major upgrade to the IT system used to manage the operation of the gas grid, known as UK Link. Since then unidentified gas has been treated as a distinct term within the allocation formula.

The volume of unidentified gas is now calculated on a daily basis and spread across all supply points using a weighted scaling factor that varies depending on the type of customer.

The calculation incorporates estimated consumption from non-daily-metered supply points. As meter reads from these supply points are submitted over time, the allocations are adjusted accordingly eventually revealing the true amount of gas that is missing.

The scaling factors are determined by the Allocation of Unidentified Gas Expert and are intended to reflect the extent to which each customer segment is responsible for the occurrence of unidentified gas. Supply points are divided into End User Categories (EUCs), depending on the amount of gas they consume, and settlement classes, depending on how often they are read.

The AUGE believes that the majority of the gas that remains unaccounted following final reconciliation has been stolen. It also believes there is a greater opportunity for theft from supply points in settlement class 4, which only requires the submission of annual meter reads.

The scaling factor for a typical domestic gas meter falling in EUC band 1 is therefore significantly lower if the supply point is also in settlement class 3, requiring daily readings to be submitted in monthly batches.

This has increased the uptake of class 3 meters beyond the levels forecast by Xoserve as part Project Nexus – the programme to upgrade UK Link.

As of 1 July 2019, there were around 170,000 class 3 supply points. Gas shippers have warned Xoserve this could rise to around 4.5 million as a direct result of the new scaling factors due to come into effect at the beginning of October.

Gazprom said this could theoretically lead to as many as 135 million meter readings being received by Xoserve in a single day, as there are no rules preventing shippers submitting their class 3 readings on the same date each month.

Ofgem said this “unprecedented volume” would push Xoserve “beyond the capabilities that its current systems have been scaled and tested to accommodate”.

To resolve the problem, Gazprom has suggested that class 3 reads should initially be loaded into an interim “staging table” that sits outside UK Link. Xoserve could then extract a safe amount from this table – perhaps one per week per supply point – and transfer them over.

The firm said this would only be a temporary measure and called for the modification to be granted urgent status to allow for its implementation before 1 October.

Ofgem has agreed to expedite the assessment process, saying it is satisfied that failure to address the issue could have a significant impact on consumers and industry parties. The regulator will publish its decision on whether to implement the proposal on 28 August.