Introduction to Elexon and the Energy Market delegate pack

Introduction to Elexon and the Energy Market

CONTENTS

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3

About Elexon

5

A letter from our CEO

6

Elexon’s stakeholders

7

What Elexon does

11

Where to find out more

11

Access our data

13

How the GB energy system works

14

Our people

16

Our seminar

17

Presenter profiles

About Elexon

3

Introduction to Elexon and the Energy Market

Introduction to Elexon and the Energy Market

Peter Stanley Chief Executive Officer

“Serving at the heart of the energy industry, building a path to Net Zero”

I joined Elexon in 2016, and was appointed as Chief Executive Officer in 2023. I’d like to thank you for joining our Introduction to Elexon and the Energy Market Seminar, and am confident that you will gain valuable insights into Elexon and Great Britain’s electricity industry.

With its purpose of serving at the heart of the energy industry, building a path to Net Zero, Elexon is shaping the energy sector of the future. We manage the Balancing and Settlement Code (BSC), which sets out the rules so that Great Britain’s energy system operates effectively.

We are trusted, independent, reliable market experts. We are funded by our customers and provide our services without making profits.

Elexon sits at the heart of the industry, working with Ofgem, National Grid, the Department for Energy Security and Net Zero (DESNZ) and BSC Parties to facilitate wholesale electricity markets, building a path to Net Zero.

We deliver an ‘end-to-end’ code manager service for the BSC. This includes helping new companies enter the market, ensuring Settlement accuracy, and managing changes to BSC rules to support initiatives to move to a smarter energy system. We also provide expert support to the Government, Ofgem and industry.

This pre-seminar pack has been designed to help you understand a bit more about Elexon before you come to visit us in person. We’ve included information around Elexon’s role, who our stakeholders are and what the BSC is. We’ve also included profiles for presenters that you will meet on the day.

Market-wide Half-Hourly Settlement (MHHS) reform will see the electricity industry working together in a significant move forward in how electricity is used and accounted for. Ofgem has placed responsibility on the industry to deliver the Programme and made Elexon the Senior Responsible Owner (SRO) of the Programme.

There is also an overview of our Board and Executive Team. At Elexon, we are commited to delivering customer value, through service excellence and successful delivery of our strategic programmes. In the seminar, we will provide an overview of our key strategic programmes, including the delivery of Market-wide Half Hourly Settlement and our technology platforms and data.

We also deliver Settlement services for the Government’s Contracts for Difference and Capacity Market arrangements; as well as the upcoming Nuclear Regulated Asset Based scheme.

On the day of the seminar you’ll get a brief introduction from a member of our Executive Team before hearing directly from colleagues across the business on a broad range of topics. You will be able to ask questions, and meet our Operational Support Managers, who are your first point of contact at Elexon.

Britain’s energy sector is going through unprecedented change and the needs and demands of our customers and consumers are evolving. We are working to ensure that our systems and processes support the changes needed so that the energy sector plays a major part in helping to meet the UK Government’s ‘Net Zero’ carbon emissions target.

I hope you’re looking forward to attending our seminar and are able to take advantage of the wealth of knowledge and experience in the room. To get the most out the day, I encourage you to network with other attendees, ask questions during the presentations and interactive sessions.

Elexon settles around 37TWh each year in balancing actions and imbalancing volumes

We look forward to welcoming you at Elexon.

Yours sincerely, Peter Stanley

That’s approximately £1.7bn of settlement transactions

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Introduction to Elexon and the Energy Market

Introduction to Elexon and the Energy Market

Who are Elexon’s stakeholders?

What Elexon does

Elexon works with a broad range of stakeholders, including electricity market participants, known as BSC Parties, as well as regulatory bodies, other code bodies, the Department for Energy Security and Net Zero, Ofgem, the Anergy Networks Association, and Low Carbon Contracts Company (LCCC).

Elexon manages the Balancing and Settlement Code (BSC), one of the major codes that sets out the rules governing electricity, so that Britain’s energy system operates effectively.

The Balancing and Settlement Code (BSC)

We also work with service providers such as CGI, KPMG and C&C.

470 Parties

What is the BSC? Regulatory Central Bodies

The BSC is a legal document that defines the rules and governance for the balancing mechanism and imbalance settlement processes of electricity in Great Britain. If you want to generate or supply electricity in Great Britain it’s mandatory to sign up to the BSC. The BSC sets out what Elexon Ltd can and can’t do as the BSCCo, and is supported by a series of Code Subsidiary Documents (CSDs) such as Balancing and Settlement Code Procedures (BSCPs) and metering Codes of Practice (CoPs).

In the early days of the BSC we used to work with paper copies. Though this still exists today, it’s now been digitised to make it more accessible. The Digital Code includes the BSC and its CSDs as well as Simple Guides and Guidance Notes.

150 Party Agents

10,000

Service Providers

pages

Equivalent to 25 packs of printing paper

364

documents

The Digital Code is made up of 364 documents totalling 10,000 pages – that’s equivalent to 25 packs of printing paper. Its size reflects the broad scope of the BSC, there’s everything from Change and Assurance arrangements to the detailed calculations of balancing and Settlement in there. Around half of the content is value added guidance to help you understand not just the ‘what’ and the ‘how’, but also the ‘why’.

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Introduction to Elexon and the Energy Market

Introduction to Elexon and the Energy Market

How does Elexon identify what type of Change is needed?

If you identify a concern, problem or defect you can address it by raising a Modification, Change Proposal or Issue (which leads to a Modification or Change Proposal).

The below matrix is a useful way of deciding what type of Change is needed:

Will my solution amend the BSC?

Change Matrix How does BSC Change work?

Do I have a clear solution?

The BSC Change process is used to progress changes to the BSC arrangements in response to any concerns, problems or defects that Parties may identify in the current processes. Under these processes, changes can be made to the Balancing and Settlement Code, its Code Subsidiary Documents and to BSC Systems. In this respect, the BSC is a living document that continually evolves to reflect the changing market.

The changes made to these documents can also impact market participant’s systems and processes, so Elexon has a robust Consultation and Release process to carefully control any changes made to the BSC.

Change Proposals

Changes that amend the BSC (i.e. obligations within the code itself)

Changes that amend the processes and systems that underpin the code (i.e. the CSDs and BSC Systems, which are the IT systems used in Settlement).

Yes

Modification

Change Proposal

No

Issue

Issue

Participant identifies concern, problem or defect

Issue Modification

It’s important to note that while Modifications make changes to the BSC, any CSDs or BSC Systems impacted by the proposed Modification would also be updated as part of the Modification process.

Change Proposal

Changes made

Outside of Modifications and Change Proposals, there are also Issues. This is where potential Changes or issues without a known solution are explored in order to decide whether a Modification or a Change Proposal should be raised.

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No

So the Change process looks like this:

There are two main type of change that can be made to the BSC, Modifications and Change Proposals (CPs).

Modifications

Yes

9

Where to find out more

Introduction to Elexon and the Energy Market

What kind of Changes did Elexon make in 2023?

BSC website

In 2023 we successfully raised and had approved 5 Modifications and 2 Change Proposals.

Here are some examples of what we’ve been working on in the last year:

Modification P376

‘Utilising a Baselining Methodology to set Physical Notifications’ This Modification implemented a baseline methodology which allowed Virtual Lead Parties (VLPs) of the Secondary BM Unit, or Suppliers for an Additional BM Unit, to determine the expected energy flows for a Metering System Identifier (MSID) Pair when calculating Non Delivery Charges and Delivered volumes.

The Elexon Corporate website holds key information about Elexon Ltd, including our Purpose, Vision and Strategy. This is where we post organisational News and Insights, current vacancies and customer surveys.

BSC Portal

‘Publication of Performance Assurance Parties’ impact on Settlement Risk’ This Modification made an amendment to BSC Section Z, allowing the Performance Assurance Board (PAB) to recommend that the Panel publish league tables of Performance Assurance Parties’ (PAPs’) contribution to Settlement Risk along with relevant risk data.

‘Ongoing Governance, Funding and Operation of the Marketwide Half Hourly Settlement (MHHS) Data Integration Platform (DIP) by BSSCo’ This Issue was raised to look into the ongoing governance of the Data Integration Platform (DIP) that will support the flow of messages between participants under the Market Wide Half-Hourly Settlement.

This Issue is currently at Assessment stage, with a Consultation around the proposed arrangements having been raised in January 2024. The Consultation will close on 21 February 2024, with the Issue Report due for publication in March 2024.

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The Elexon portal contains your organisation’s Operational, Financial and Credit data alongside market data that Elexon publish.

The Elexon Insights Solution is a key pillar of Elexon Kinnect, a digital customer-centric platform delivering a smart and flexible central data platform for the industry.

Through a number of releases over the next few years, the platform will publish Balancing Mechanism Reporting Service (BMRS) data as well as Open Settlement Data.

It benefits the market by increasing the effectiveness of all detective and investigative Performance Assurance Techniques (PATs) through greater incentives.

Issue 101

Elexon website

Access our data

This benefitted Parties as it allowed Balancing Service Providers to be fully recompensed for their actual change from normal usage and the impact this change had on the system.

Modification P427

This site contains a wealth of resources to guide and advise customers on the processes within the BSC, Alongside the Digital code itself and the supporting BSCP documents.

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Insights Solution

Introduction to Elexon and the Energy Market

How the GB energy system works

Top outputs we delivered for customers in 2023 Helped 58 companies enter the market and register for BSC roles

5 Modifications 2 Change Proposals

7

Delivered 18 iterations of the Kinnect Insights Solution/Customer Solution/ Settlement Solution

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18

4,868

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Once they’ve generated that electricity, they sell it on to...

Suppliers who buy based on their predictions around how much

energy their customers will need to use. They then sell that electricity on to...

Consumers , or customers. This is anyone that uses

electriticity in GB. Whether that’s just boiling the kettle for a cuppa at home or powering a central London spin studio or a large factory, we’re all consumers within the GB energy market.

Reviewed 20 consultations and responded to 6

£1.6 billion 4,868 Settlement Runs carried out

farms generate the electricity Great Britain needs.

58

10 Qualification applications approved by the Performance Assurance Board

Managed £1.6Bn in Credit Cover

Generators like power stations, wind and solar

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National Grid ESO is Great Britain’s electricity system operator.

They are responsible for moving energy around GB’s system to meet demand as it rises and falls, balancing supply and demand.

Helped 3 Virtual Lead Parties enter the market

Ofgem is GB’s independent energy regulator. They make

3

Processed more than 11,155,893 Energy Contract Volume Notifications (ECVNs)

Managed 99 Trading Disputes totalling more than £19Bn

11 million

£19 billion

sure that the market operates fairly and the rules are followed.

The Department for Energy Security and Net Zero is the government department that implements the energy policies decided on by the UK government.

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Introduction to Elexon and the Energy Market

Introduction to Elexon and the Energy Market

Our people

Elexon’s Executive Team Elexon’s Executive Team is responsible for the company’s day-to-day management. They work with the Board, the BSC Panel and our colleagues to ensure the successful delivery and development of the Balancing and Settlement Code (BSC).

Elexon’s Board The members of the Board have a strong mix of multi-disciplinary experience and a composition that follows corporate governance best practice. The Elexon Board is ultimately accountable to BSC Parties.

As well as the below members, the Board also includes Elexon’s CEO, Peter Stanley.

Geraldine Buckland Chief People Officer

Anne Heal Non-Executive Director

Ian Graves Industry Non-Executive Director

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David Titterton Industry Non-Executive Director

Sara Vaughan Chair

Helen Adey Director of Strategic Programmes

Jessica McGoverne Director of Corporate Affairs

Devrim Celal Industry Non-Executive Director

Peter Stanley Chief Executive Officer

Saso Bruzzese Chief Technology Officer

Steve Page Chief Financial Officer

Victoria Moxham Director of Customer and Code Management

Tim Fitzpatrick Independent Non-Executive Director

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Introduction to Elexon and the Energy Market

Introduction to Elexon and the Energy Market

Our seminar

Presenter profiles

Agenda

Agenda item

Time

Registration and coffee

9:30

1. Executive Introduction

10:00 Peter Stanley Chief Executive Officer 10:05 Raeece Ibrahim Operational Support Manager 10:10 Ban Mac, Senior Product Analyst 10:50 Kim Balmer Portfolio Business Analyst

2. Introduction and housekeeping 3. Imbalance Settlement 4. Insights Solution

5. Feedback session one Break 6. Supplier Volume Allocation 7. Market-wide Half Hourly Settlement 8. Feedback session two Lunch 9. Our role as National Electricity Transmission System Operator (NETSO) 10. Imbalance Prices

Presenter

Romit Ray Delivery Lead 11:00 Raeece Ibrahim Operational Support Manager 11:05 11:25 Samantha Safari Product Analyst 12:05 Matthew McKeon, Senior Design and Industry Code Advisor 12:45 Raeece Ibrahim Operational Support Manager 12:50 13:30 Joe Henry, Senior Commercial Code Change Lead

14:00 Yinka Afolabi Product Analyst 11. Feedback session three 14:30 Raeece Ibrahim Operational Support Manager Break 14:35 12. Performance Assurance 14:50 Simon Waltho Framework Risk & Technique Analyst 13. EMR Settlement Limited (EMRS): 15:10 Roan Chavez What is our role?

Business Analyst

14. Feedback session four 16

Close

Cameron Guest Settlement Analyst 15:30 Raeece Ibrahim Operational Support Manager 15:35

Organisation Elexon Elexon Elexon Elexon

Elexon

Elexon Elexon

Ban Mac Senior Product Analyst

Cameron Guest Settlement Analyst

Ban re-joined Elexon in 2022, having worked in various Analyst positions from 2012-2019. In between roles at Elexon, Ban worked as a Business Intelligence Analyst for the Low Carbon Contracts Company.

Cameron is a Settlement Analyst in the EMRS team. He joined Elexon in 2023.

Joe Henry Senior Commercial Code Change Lead Joe joined ESO in 2018, having worked as an industry regulatory analyst at EOn. At ESO, Joe has worked in Code Governance and on European Frameworks, and regularly takes part in industry code workgroups across the CUSC and the BSC.

Elexon

NETSO

Elexon Elexon Kim Balmer Portfolio Business Analyst

Elexon EMRS

Elexon

Kim has been part of the Business Analysis Practice team at Elexon since February 2022 and is part of the delivery team for the Insights Solution.

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Matthew McKeon Senior Design and Industry Code Advisor Matt joined Elexon’s Market Design team in 2014 and has been working on MHHS since 2018, joining the MHHS Programme in 2021. Previously, he worked at EDF Energy for 14 years.

Raeece Ibrahim Operational Support Manager Raeece joined the Customer Engagement team as an Operational Support Manager in 2023.

Introduction to Elexon and the Energy Market

Roan Chavez Business Analyst

Romit Ray Delivery Lead

Samantha Safari Product Analyst

Roan re-joined EMRS in 2023, having worked for Elexon previously as a Market Entry Analyst in the Participant Management Product Team from 2019-2021.

Romit joined Elexon in 2023 as Delivery Lead in Settlement and Insights team, having worked in the financial industry and telecomms in Ops and Transformation Delivery roles.

Samantha became part of the Settlement & Insights team at Elexon in October 2021, joining us in a Product Analyst capacity.

Simon Waltho Risk & Technique Analyst

Yinka Afolabi Product Analyst

Simon started working at Elexon in March 2022, working for just 8 days in our offices before we went into national lockdown for COVID-19.

Yinka joined Elexon in 2021 and works as a Product Analyst in the Settlement & Insights team.

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