Expert energy analysis and insight for UK businesses.
So you’ve sorted out your ESOS reporting, you’ve agreed your energy strategy and your sustainability goals. And low carbon generators have absorbed the government’s decision to stop issuing renewable LECs. All done. Moved on.
But, did you consider one other thing? Did you wonder about reporting your energy contracts to the EU Energy Regulator? The good news is that you may not need to – read on and I’ll explain who does because we may both be involved.
It’s all about REMIT! - EU Regulation on Wholesale Energy Market Integrity and Transparency
First, a quick re-cap. Phase 1 of REMIT came into force on 28 December 2011. It’s designed to reduce market abuse (insider trading and market manipulation) of the EU’s energy markets by increasing their transparency. Which is good for everyone.
Phase 2 of REMIT, covering the reporting of contracts and transactions, started on the 7 October 2015 and takes full effect from the 7 April this year.
Since 7 October 2015, energy contracts traded on organised market places such as exchanges have to be reported to ACER (Association for the Cooperation of Energy Regulators).
The main focus of REMIT is on organisations operating in the wholesale energy markets, but from 7 April 2016, Phase 2 of REMIT also impacts:
1. Single sites “technically capable” of consuming 600GWh or more per year of power or gas.
This means the maximum amount of energy that could be consumed if the site was run at full use throughout the year, irrespective of the actual consumption or the volume stated in the supply contract. Remember: this is about the capability of a single site and not your whole portfolio added together!
2. Any electricity generator with a Power Purchase Agreement (PPA) where the installed capacity of the generation asset(s) is greater than 10MW.
The installed capacity under the single PPA can be for an individual asset or combined installed capacity of a number of assets. And it doesn’t matter how much power is actually exported to the supplier under the PPA.
So if you’re sure you don’t fall into these groups, then you’re not affected by Phase 2 of REMIT. Nothing more for your REMIT to-do list for now. Great.
However, if you do then your supply contract / PPA must be reported to ACER, and you will need to register with Ofgem. Read on and we’ll give you an overview of those four steps to compliance that I mentioned earlier on.
Step 1: Check if you’re impacted
Go on, just to make sure. If you are covered and you fail to register with Ofgem or report your contract(s) you will be in breach of REMIT.
So remember, you’re impacted by REMIT Phase 2 if you:
Operate a site with the capability to consume 600GWh per year or more, or
Have over 10MW of installed generation capacity with a single PPA.
If you believe the answer to either is yes, then you need to follow steps 2 to 4. Read on and get in touch with your EDF Energy account manager, we’re ready to help.
Step 2: Register with Ofgem by 7 April 2016
All the information you need for the registration process can be found in Ofgem’s REMIT Registration FAQ and Registration User Guide.
Step 3: Initial Reporting - notify ACER you have a contract in place
Both the buyer and seller organisations (that’s you and us) need to notify ACER of the details of the relevant supply contract or PPA that’s been put in place.
Step 4: Regular Reporting - deliver monthly reporting to ACER on your contract
Every month for the duration of your contract, we both need to report to ACER.
Steps 3 & 4 reporting needs to be submitted in a standardised format through a Registered Reporting Mechanism - you’ll find full information on REMIT transaction reporting and FAQs on ACER's REMIT web portal.
And if we’re not already in conversation about your REMIT reportable contract, get in touch with your EDF Energy account manager as soon as possible so that we can all be prepared and keep our to-do lists ticked off together.
We have a series of events, webinars and publications to help you keep on top of energy and the changing energy landscape. It’s called Talk Power and you can subscribe for more updates like this one. See you soon.