Following a consultation in September 2018, the Utility Regulator is publishing a final determination and licence modifications consultation on the Power Procurement Business (PPB) price control, to apply from May 2019 to September 2023. This will replace the existing price control, in place since April 2015.
The PPB was established as part of the privatisation of the Northern Ireland electricity industry as a guaranteed purchaser following the creation of long-term power purchase contracts. PPB purchases energy from independent generators under these long-term contracts, while also making payments for availability. PPB sells this energy into the SEM, while also retaining capacity and ancillary services revenue. Any mismatch (either positive or negative) between PPB’s costs and revenues will be rebated to or collected from customers via the NI Public Service Obligation (PSO) levy.
Under the final determination, the costs of running PPB will reduce from £4.6m to £3.8m, with an additional gain sharing mechanism whereby PPB retain a percentage of any annual surplus on the long term contracts. The contracts expire in September 2023, and can be terminated, with six months’ notice, by the Utility Regulator during this period. This is therefore the final price control for PPB, and will apply from May 2019 until the contracts expire or are terminated.
The licence modifications necessary to enact the final determination are also being published for consultation. Responses to the consultation by interested parties should be received by 5pm on 15 February 2018.