Development of the RECCo Strategy for the financial year 2025/26 and beyond
Board Members were briefed on live Ofgem and Government consultations that may impact RECCo and/or the arrangement governed under the REC. These included the process for appointing a potential successor to the DCC, extension of GT of last resort provision of gas metering, governance of a data sharing infrastructure, flexibility market asset register, and consumer consent.
Some of these consultations directly affect RECCo’s Strategic Objectives, which will be discussed further at the forthcoming Board Strategy Day. The Board was also updated on responses RECCo has provided to consultations that have concluded since the June Board meeting.
The Board then discussed the agenda for the Strategy meeting in September. The first day will focus on scenario development and longer-term planning, with the potential RECCo Target Operating Model to be covered on the second day. The Board will also discuss preparation for and implications of becoming the Code Manager licensee for the REC, which is expected to take effect in the first quarter of 2026.
Enquiry Services update
The Board received an update on the current performance of the Gas Enquiry Services (GES) and Electricity Enquiry Services (EES). This included an overview of the GES re-platforming activities and progress on the Enquiry Services Evolution Project. In summary, both services are operating well regarding their respective Service Level Agreement-related Key Performance Indicators, and user feedback is positive.
The focus remains on delivering the successful transition of the GES data onto the new ‘Big Data’ platform following a partial migration in June. The remaining elements of the service will transition to the new platform in mid-October, and the GES will continue to operate as required as it moves through the required migration activities.
The Enquiry Services Evolution project covering both GES and EES is progressing well. A comprehensive set of user requirements has been captured through internal and external workshops, discussions with incumbents, and the use of an Industry Stakeholder Advisory Group; a ‘model contract’ has been developed. The next milestone for the project will be the release of the RFP to the incumbent suppliers, which is planned for the end of September.
Financial Performance
In line with sound financial management and good corporate practice, the RECCo Board regularly reviews the organisation’s financial performance. The review covers performance against the agreed Budget to ensure the company has the resources to meet all its financial and service delivery obligations.
The results for the first quarter of the Financial Year 2024/25 were reviewed, and the Board noted a c.12% underspend against the Budget for that period. The Board was informed that the underspend reflected a combination of timing associated with Budget phasing assumptions and the realisation of cost efficiencies in those three months. These latter elements will translate into a rebate to funding Parties on completion of the financial year, in line with past practice.
The Board recognised the committed levels of spend against the full-year Change Allowance. Also, there is the expectation that certain activities will be funded from the Contingency budget, for example, if Ofgem appoints RECCo to progress activities currently under their consultations; this includes the existing Central Registration Service and new Consumer Consents project.
Consumer Consent Project
The Board was provided with an update on the Consumer Consent Project. They reviewed and agreed to a proposal to support Ofgem’s “minded to” position of having the REC and RECCo as the Code and Delivery Body, respectively, for a consumer consent mechanism; the Board also approved the use of contingency spending to deliver the project.
Consent is one of the six legal bases for processing personal data. The lack of a consistent consent process for consumers can be confusing and can create barriers to delivering the UK Net Zero targets. This policy aims to improve consumer trust in the energy sector.
RECCo has been appointed as the delivery body for the consumer consent mechanism. This aligns very well with our mission statement and REC objectives: “deliver positive consumer outcomes” and “ensure customers’ interests and data are protected.”
Stakeholder engagement programme
The Board received an overview of RECCo’s ongoing efforts to enhance transparency and increase stakeholder input across our key activities and programmes. Central to this initiative is RECCo’s multi-channel approach, designed to ensure that industry stakeholders are well-informed and can provide valuable feedback. The Board was informed that RECCo has now established three Stakeholder Advisory Groups, composed of various stakeholders, to guide RECCo project teams across core programmes for the financial year 2024/25. These include the evolution of the Code Manager Service, the Enquiry Services, and the potential transfer of the Central Registration Services.
Additionally, RECCo has published its first Quarterly Report, a new initiative to outline RECCo’s progress against the Forward Work Plan for 2024-2027 and to provide stakeholders with greater insight into the performance of core REC Services.
RECCo’s event programme also continues to expand, offering stakeholders key information on various activities. In July, we hosted a successful Market-wide Half-Hourly Settlement (MHHS) webinar to explain the key changes to REC arrangements because of the programme; six more events are planned in the coming months, including a Roadshow series in October in Manchester, Birmingham, and London. These events will allow RECCo to connect directly with stakeholders and discuss our strategic priority of ‘Delivering Service Excellence’. Other updates include work on RECCo’s annual stakeholder satisfaction survey, scheduled for November 2024, and the recent refresh of RECCo’s website to improve user experience and facilitate easier access to key information.
