On May 21 2024, Ofgem initiated a consultation on the future of the Central Registration Service (CRS). The purpose of this consultation is to gather feedback from stakeholders regarding the future of the CRS, as well as to consider future governance arrangements for the Data Communications Company (DCC). Ofgem is seeking input from individuals and organizations involved in smart metering, particularly DCC customers, by July 16, 2024. This includes energy suppliers, distribution network operators, consumer groups, and other current or potential users of the DCC network.
We fully support transferring the CRS obligation to the Retail Energy Code (REC) to be managed by RECCo. Below, we discuss the benefits of transferring the CRS to the REC and the key principles of our transition plan, subject to Ofgem’s decision to transfer the service.
What are the anticipated benefits of transferring the Central Registration Service to the REC?
In the consultation document, Ofgem asks, “Do you agree with our proposal that it would be appropriate to remove the provision of the Centralised Registration Service (CRS) from the DCC Licence and transfer the obligation to the Retail Energy Code (REC) to be delivered by RECCo?” Ofgem then explains its rationale for this preliminary position and outlines the anticipated benefits, which include:
- “With RECCo providing the CRS, governance and decision-making will be streamlined, allowing industry to have a greater influence on the delivery of the service.”
- “RECCo will be able to explore options for service enhancements and redress.” Ofgem then gives a particular example to address quality improvement.
- “RECCo would be able to speed up the delivery of change. In particular, RECCo could use the Design Authority function embedded within REC Technical Services, which could remove additional steps from the current process and reduce layers of complexity due to RECCo not having to work through a third party.”
- “We understand RECCo has been able to identify areas of possible cost savings, such as removing potential duplication of efforts and driving efficiencies within the Switching Operator role. This includes, for example, removing any additional management layers, or aligning the CRS technical services to other technical services within the RECCo catalogue. Further savings could be realised through the re-procurement of the main External Service Provider contracts upon their expiry.”
- “RECCo is a not-for-profit organisation, meaning that no margin will be recovered, and these potential savings will be passed on to industry and consumers.”
- “RECCo would be well placed to provide effective communication and management of incidents due to the organisation already having in place established channels of direct engagement with industry, for example the REC Issues Group.”
There are additional benefits beyond those identified by Ofgem, including further financial savings and enhancements to the switching service and the broader retail market. We are currently exploring the potential Service Delivery Model (SDM) to realise these benefits under RECCo, if Ofgem makes the decision to transfer the CRS service to the REC.
The SDM defines how the CRS would be governed, managed and operated under RECCo. It details how RECCo, the Code Manager, and the CRS Service Providers would work together to deliver and execute the processes that make up the CRS. The SDM will define the processes, roles and responsibilities, touchpoints, and handoffs across all of the CRS components, including the operation of the Central Switching Service and the Switching Operator role.
We’re building a transition plan
Noting the criticality of the service to industry and consumers and to minimise potential risks, costs and disruption to users, we believe that it is prudent to understand the practical implications of any transfer process in the event of Ofgem making a positive decision. To this effect, we are working on a transition plan to outline the process of transferring the service from DCC to RECCo ownership by September 2025. This plan will help us adhere to two key transition principles:
- Users will experience minimal disruption to the CRS service on the transfer day;
- Existing CRS Service Provider contracts will be transferred to RECCo to operate with minimum impact on users on the day of transfer.
Our transition plan will cover all the work needed to ensure we are ready to operate the service.
We will include more detail about the SDM and the transition plan in our response to Ofgem’s consultation and will continue to develop both until Ofgem publishes its decision. This ensures that we are prepared to deliver the transition upon a positive Ofgem decision.
Next steps
As we continue to prepare our response to the Ofgem consultation, we want to engage with service users and obtain their views and guidance. We have established a Switching Stakeholder Advisory Forum to facilitate this, which will meet in early July. The Forum will provide advice and feedback to the CRS Transfer Project team to help inform its direction and decision-making and provide information that will help Ofgem assess the options. We will publish the output from each meeting on our website. If you would like to discuss this work in any more detail, please contact Lorraine Martin (lorraine.martin@retailenergycode.co.uk), who will be happy to arrange a meeting with you.
