Response to DCC Service Provider Performance Charge Consultation

July 25, 2022

Consultation

RECCo issued a consultation in April 2022 on Data Communications Company (DCC) Service Provider Performance Charges. This was issued due to a proposal from Ofgem that some of the DCC’s Switching Service Level Agreements (SLAs) under the REC, could be subject to assurance through Ofgem’s regulated price control rather than the REC Performance Assurance Framework (PAF).

The consultation sought views on:

Which DCC SLAs REC Parties consider are the most material and impactful should these be failed;
Whether some DCC SLAs should be subject to charges under the Switching Incentive Regime (SIR) rather than the REC Performance Assurance Framework;
Whether the SIR should consider individual SLAs across all three DCC Services, or individual DCC Services in their entirety, noting that a single service being subject to assurance under two regimes may be complex given the proposal to link the level of charge to the number of failed SLAs; and
RECCo’s concerns that splitting the assurance of the DCC, as a REC Service, between two regimes could undermine RECCo’s ability to hold its Service Provider to account for the end-to-end delivery of its services.

Responses

We received five non-confidential responses to the consultation from two Energy Suppliers, two Distribution Network Operators and the DCC. Please see the non-confidential responses below:

We would like to thank stakeholders for their responses to this consultation. We have considered these comments carefully, in collaboration with Ofgem, in order to agree next steps. A summary of the consultation responses and our response to these comments can be found here.

Next steps

A proposed solution has been developed between Ofgem and RECCo. The solution is based on a REC PAF-led approach, working within and complementary to the DCC price control. Under this model, the REC PAF would be the mechanism through which to manage and incentivise the DCC’s operational and service performance of its various switching roles, including improvement in a timely manner where and when necessary. Ofgem will retain oversight of DCC’s overall Customer Engagement and management of its contracts with service providers which are not visible to the REC PAB.

The REC Code Manager will now progress Change Proposal R0025, reflecting the proposed solution and we will work closely with the DCC in the development and progression of this Change Proposal.