Decision under Article 14(8) of the Electricity (NI) Order 1992 for the Power NI Electricity Supply Licence
| Published date | 05 February 2024 |
| Year | 2024 |
| Energy Sector | Electricity Networks |
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THE NORTHERN IRELAND AUTHORITY FOR UTILITY REGULATION
DECISION UNDER ARTICLE 14(8) OF THE ELECTRICITY (NORTHERN IRELAND)
MODIFICATIONS OF THE LICENCE HELD BY POWER NI ENERGY LTD TO SUPPLY
ELECTRICITY
In accordance with Article 14(2) of the Electricity (Northern Ireland) Order 1992 (“the
Order”) the Northern Ireland Authority for Utility Regulation (“the Authority”) published
on 22 November 2023 a notice ("the Consultation Notice") of its intention to modify a
condition of the electricity supply licence ("the Licence") held by Power NI Energy Limited
("the Licensee").
The modifications proposed were published alongside the Consultation Notice.
In accordance with Article 14(5) of the Order, the Authority has now considered the
representations duly made to it following the publication of the Consultation Notice and has
decided to proceed with the making of modifications of the conditions of the Licence, in
exercise of its powers under Article 14(1) of the Order.
In accordance with Article 14(8) of the Order, the Authority hereby gives notice as follows:
1 The Authority has decided to proceed with the making of the modifications proposed
of the conditions of the Licence, in exercise of its powers under Article 14(1) of the
Order.
2 The modifications are to the supply charges restriction as set out in Annex 2 (to
Condition 55) of the Licence. The modifications are shown in the revised version of
Annex 2 as set out in Schedule 1 to this notice.
3 The effect of the modifications is to:
(a) introduce a new sub-paragraph (m) to the Et term, set out in paragraph 2 of
the Annex, which provides for the Licensee to be able to recover the
reasonable costs incurred by it in administering the provision and delivery of
EBSS payments, and other associated requirements, as set out in the
direction made on 22 December 2022 by the Secretary of State pursuant to
section 22 of the Energy Prices Act 2022 (“the Direction”), subject to the
Authority's determination as to the costs it considers to be reasonable and
subject to the relevant costs not being recovered or recoverable by the
Licensee under another part of the Licence, under any other licence, or under
any other legal instrument (including the Direction); and
(b) make minor and consequential changes to the introductory text of the Et term
in paragraph 2 of the Annex to reference the new sub-paragraph (m) and to
existing sub-paragraphs (j) to (l) to correct previous drafting.
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4 The reasons why the Authority has decided to modify the Licence are as follows:
(a) During the winter of 2022/23, the UK Government developed certain
schemes (known as the Energy Bill Support Scheme (“EBSS”) schemes) to
provide direct financial support to domestic consumers in light of increased
energy costs. In Northern Ireland, this included schemes (known as the
Energy Bill Support Scheme (“EBSS”) and Alternative Fuel Payment
(“AFP”)), under which electricity suppliers were required under and in
accordance with the Direction to make payments totalling £600 to each of
their eligible domestic electricity consumers by direct transfers to bank
accounts or by way of vouchers.
(b) The UK Government funded the amount of the EBSS payments made by
electricity suppliers but did not fund the costs incurred by electricity suppliers
in administering the EBSS schemes.
(c) The Licensee recovers its costs through the charges it levies on consumers
and is the only Northern Ireland electricity supplier whose domestic charges
are subject to a price control set by the Authority. Accordingly, its electricity
supply charges for domestic consumers cannot exceed those calculated
under the provisions and formulae of the price control, as set out in Annex 2
to Condition 55 of the Licence. The provisions of Annex 2 do not currently
enable the Licensee to recover its costs of administering the EBSS schemes
set out in the Direction and described above.
(d) The Authority considers it appropriate for the Licensee to be able to recover
its reasonable costs incurred in administering the EBSS schemes as required
by and set out in the Direction.
(e) The Authority is satisfied that the modifications involve changes which are
best calculated to meet its statutory objectives and duties at Article 12 of the
Energy (Northern Ireland) 2003, as it was in the interests of consumers in
Northern Ireland to receive their EBSS payments and thereby in the interests
of consumers for the Licensee to recover its reasonable costs, of ensuring
that those payments were effectively administered and made, through its
regulated tariffs.
5. On 22 November 2023, the Authority published a notice
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stating that it intended to
modify the Licence to allow for the introduction of a new Et term as a result of the
delivery of the Energy Bill Support Scheme (“EBSS”) and Alternative Fuel
Payment. The purpose of this notice was to bring the proposed modifications to
the attention of persons likely to be affected by them and invite representations or
objections in connection thereto. The UR received two responses to the
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Notice under Article 14(2) of the Electricity (NI) Order 1992 for the Power NI Electricity Supply Licence |
Utility Regulator (uregni.gov.uk)
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