Don’t be fooled by new electricity penalty charges

Businesses are being warned not to get caught out by a new excess penalty charge for electricity usage which will be introduced on 1 April 2018.

The new charge, called DCP 161, will be applied to all organisations which have a Half Hour (HH) electricity supply and are exceeding their agreed consumption rates. It poses a dual threat to businesses who could see their bills for excess usage triple and potentially risk supply if they don’t meet their capacity obligations.  This new measure will also apply to businesses that converted to HH meters as result of P272 introduced in April last year.

Schedule a review of capacity levels

DCP 161 has been introduced by OFGEM to allow District Network Operators like Western Power Distribution to recover the additional costs they incur when customers exceed their agreed supply capacity.

“The reality is that very few organisations will know whether they have HH meters and what their capacity agreement is so this really could present a very nasty surprise”, explains Duncan Banks, CEO at IU Energy. “We are advising our clients to reduce consumption and avoid unnecessary charges. We encourage all businesses to check their arrangements and seek professional advice if they are unsure – it could save some potential headaches next month”, he continued.

In order to avoid excess penalty charges, business are able to agree a new maximum supply capacity before 1 April. Once that has been agreed, the District Network Operator is obliged to meet the capacity.

“Whilst measures such as DCP 161 present yet another threat to business energy costs, it is a useful opportunity to measure capacity requirements, assess efficiency and drive down bills”, Duncan concluded.

What should I do?

You need to act before 01 April 2018 to avoid excess penalty charges.

– IU Energy will assess your current capacity and charges; in order to do this you should send us a full copy of your most recent electricity invoice. This provides key data that is required to carry out your review.

– IU Energy will review your current electricity meter profile and kVA capacity limit along with any potential for excess charges.

– We will report back to you confirming if you need to take action. If you do IU Energy will assist in the application for amending your capacity settings.

IU Energy will also advise, install and operate engineering solutions to reduce energy consumption, lower costs and avoid excess charges.

To find out if you are affected call IU Energy on 01752 26 26 26 or email info@iuenergy.co.uk to review, analyse and agree the correct supply capacity levels.