Payment Method Levelisation

What is Payment
Method Levelisation?

Historically, British customers on pre-payment meters (PPM) have paid more for their energy than those on direct debit (DD). On the 15th of March 2023, the Chancellor announced that the Energy Price Guarantee (EPG) would be used to align costs for PPM and DD customers. Initially, these costs were aligned by giving PPM customers a unit rate discount.

Why is reconciliation
needed?

This programme levelises tariffs by requiring energy suppliers to charge DD customers more whilst discounting PPM tariffs. However, a reconciliation method is required as the payment method split is not the same for each Supplier’s portfolio. This is so Suppliers with higher-than-average PPM consumers can be credited, whilst those with fewer-than-average can be debited.

What is RECCo’s
role?

RECCo were tasked with developing industry processes under the Retail Energy Code (REC) and designing, building, testing and delivering a functional system that facilitates supplier payments to allow for non-volumetric levelisation. This system went live on the 1st April, 2024. The change to the REC came into place through Change Proposal R0147, which implemented a new REC Schedule for Payment Method Levelisation (PML) Reconciliation, Schedule 31.

What do Suppliers need to do?

Each region must be populated, even if there is no data i.e. populate with zeros and with relevant date format
File name format for single rate electricity: MPID_YYYYMM_S.csv
File name format for multi-rate electricity: MPID_YYYYMM_M.csv
File name format for gas: SSC_YYYYMM.csv
Files using column headers or regions different to the template will not be accepted

Please check your submission before uploading to your SharePoint area to ensure that the Metering Arrangement column is populated correctly with either ‘Single’ or ‘Multi’ and that the correct data is matched up to each region.

Supplier Obligations

In accordance with paragraph 4.1 of Schedule 31 of REC, RECCo is requesting the data in the template detailed here, which it needs to calculate the PML Reconciliation Amounts payable by and to each Domestic Supplier. Additionally, under paragraph 4.2 of this Schedule, each Domestic Supplier shall submit Payment Portfolio Data to RECCo by no later than the PML Reconciliation Reporting Submission Deadline.

In accordance with paragraph 4.4 of Schedule 31 of REC, RECCo shall notify Ofgem and REC Performance Assurance Board to take further compliance or enforcement action where appropriate, including where we see evidence of a pattern of late or poor responses to our requests, those containing incomplete or inaccurate information.

Invoice Schedule

PML Reconciliation Invoice Schedule

Levelisation Payment Details

This document details the total value of invoices sent to Suppliers and the proportion of that amount collected from Suppliers. For Suppliers due to receive payment from the scheme, it includes the proportion of their calculated credit that RECCo has paid out for the current & previous invoice periods.

Payment Details to December ’24
Payment Details to January ’25