On 23rd January, we held a webinar with stakeholders to introduce our Draft Strategy and Forward Work Plan for 2024-27. The event highlighted our progress over the past year and provided a detailed breakdown of our proposed plans and priorities for 2024-25 and our trajectory towards 2027.
Our priorities for 2024-25
The webinar focused on four key strategic priorities that will shape our activity in the next year:
- Delivering Service Excellence: We want to enhance our existing services, ensuring they are efficient and effective and meet the high standards expected by users.
- Data & Digitalisation Strategy: Our focus is centred on opening the data we control and transforming data-driven REC Services, systems and processes to better meet the needs of the energy market and consumers.
- Energy Theft Reduction Strategy: We aim to deliver the insights, tools, and services that will enable REC Parties to prevent, detect, and respond to energy theft more effectively.
- Regulatory Programmes and Policy Delivery: We seek to keep pace with the evolving regulatory landscape to ensure that the REC and REC Services meet the evolving needs of parties and wider stakeholders.
Webinar highlights
Experts from RECCo’s leadership team delved into the progress made in 2023-24 and outlined detailed plans for the upcoming year. Our Director of Finance and Commercial, Brian O’Shea, also presented the indicative budget, giving stakeholders an understanding of the finances required to support our work over the coming three years. A Q&A session allowed participants to interact and ask questions to the RECCo team. We’ve included a write-up of this Q&A session at the end of this article.
Watch the recording
If you missed the webinar, you can watch the recording in full below or download the presentation slides here. Please feel free to share with colleagues if they would find this helpful.
Next steps
- Take part in the consultation
Your feedback is important to us and helps us ensure our work aligns with the needs of the energy sector and its participants. The Draft Strategy & Forward Work Plan is open for consultation until 5 pm on 5th February 2024. Interested parties are invited to submit their comments via email at recco_strategy@retailenergycode.co.uk
- Join the 2024-25 Budget webinar
Following the closure of our Forward Work Plan consultation, we’re hosting a webinar to give a thorough explanation of the budget needed to deliver our strategy and our supporting commitments over 2024-27. Register here.
Key questions from the webinar
Our webinar participants raised a number of valuable questions, which are summarised alongside responses from the RECCo presenters below:
Question: With such a broad transformation programme, what is RECCo’s plan for enduring engagement with stakeholders at a strategic level?
Rachael Anderson, Director of Corporate Affairs: “We understand that transparency of our work and enabling stakeholder engagement and input into the development of our initiatives is key. We’ve been looking at ways to enhance our communications with you around our Strategy & Forward Work Plan in particular, and so this year, we’ll be introducing quarterly reporting and updates on our progress against the plan.
This means stakeholders can have a better understanding of how we’re doing as an organisation in terms of our commitments and initiatives. This will keep you better informed of how you can get involved in those initiatives as we develop through the year.
I want to address your reference to transformational programmes. Our focus for the next year is on the evolution of our services rather than being transformational. This is designed to address the issues raised by parties, which we’ve actively sought over the past year through the various channels that we mentioned earlier. It’s also key to highlight that RECCo, our management team and the Code Manager do not work in isolation. We follow a joined-up approach to make sure we deliver the forward work plan commitments with all our service providers, and this includes sharing any feedback received by our stakeholders both ways. All feedback, despite which route we receive, forms our collective next steps and the decisions that we make.
In terms of our communication and engagement approach with stakeholders here at RECCo, we create an annual stakeholder engagement plan which is approved by the RECCo Board and that guides our engagements and communications over the next year. This includes a multichannel approach. Firstly, covering our communication channels, we provide regular updates on our organisation’s progress and ways to engage with us via our monthly newsletter, the RECCo website and our LinkedIn account; we also provide updates through the weekly Code Manager bulletin and OAMs for full transparency
We also have separate engagement plans for all of our strategic initiatives. This includes the four strategic priority areas that we set up for you today. These will all have individual stakeholder plans that will guide our engagement channels and timing over 2024-25
Webinars will continue to be a key channel for our engagements over the next year. As an example, we’re currently planning five webinars over the next three months across all of our different initiatives. We will also use consultations as one of our engagement routes. An example of where we have used consultations in the past is with our data and digitalisation strategy, which helped us understand your needs and what we needed to prioritise.
We’ll also be continuing with our roadshow series over the next year. We went to various places around the country last year to directly speak to you and understand your feedback, needs and wants. This really helped us shape our priorities for 2024-25. Find out more about this feedback here. Last year, we introduced stakeholder forums and an expert group for our energy theft strategy programme, and we understand you value these forms of engagements with us, so we will be building upon this approach and introducing appropriate user forums to help support our Delivering Service Excellence workstream, and so you can directly shape the evolution of services like the code manager.
Increasingly, we also want to have greater opportunities for face-to-face meetings with you over 2024-25. This will help us better understand your own business concerns and how RECCo can respond to them. Also, really importantly, form better relationships with you as our stakeholders.
Finally, I think it’s worth saying that – at RECCo – we really do value your input and insights. Your priorities are reflected in what we’re trying to achieve, and I hope you can see that today. We’ve recently brought on board a Customer Insights Manager in January, and she’ll be helping us going forward with delivering our strategic engagements.”
Question: “The REC Services costs increased from 34m to 37.4m to 40.7m. Can you explain this increase year-on-year and also talk about the project cost changes?”
Brian O’Shea, Director of Finance and Commercial: “We have fixed-price contracts which have initial and then further terms if extended. Several of the initial terms for these contracts expire in the next 12-18 months. Indexation applies for any extended periods, and this accounts for part of the uplift year on year. REC services impacted include the Central Switching Service, Code Manager service and Energy Enquiry Services.
We also plan to develop several initiatives in the coming year, and we have included allowances for the service cost of those from 2025-26 onwards as they transition into service delivery. These, in particular, relate to the deployment of the API Gateway functionality and the development of theft initiatives.
In addition, the market for professional services reflects both skills shortages and high rates of inflation, which has driven up service provider costs, and we expect these to have an impact on our procurement activities in the latter stages of the plan, in particular, the Code Manager services.
Question: “What work do you envision being done under the Central Registration Service transfer budget line?”
Elizabeth Lawlor, Director of Operations: “As part of its review of the Smart DCC Licence, Ofgem has identified the potential for the transfer of responsibility for the delivery of the Central Registration Service (CRS) from the DCC to RECCo. They plan to consult further on this in Spring 2024 and have asked both DCC and RECCo to provide information to support this activity.
RECCo’s initial analysis indicates that there is a positive case for change, and this piece of work will assess the benefits and best means of realising them in more detail.
This budget line is to support further analysis of the options and due diligence work, including engagement with stakeholders, to develop a credible transition plan should the evidence support a case for change. As this is an additional activity outside of business-as-usual operations, it is appropriate that we recognise this within the budget and are transparent about this activity. Following Ofgem’s consultation, any further costs would only be incurred if there is a decision to move forward with the transfer or RECCo is required to undertake additional work to support any alternative review outcomes.
Question: “Will the underspend be taken off the 2024-25 invoice and not refunded to Parties?”
Brian O’Shea, Director of Finance and Commercial: “It will be refunded to Parties, but the means of the refund is that we reduce one of our 224-25 quarterly invoices by the full value of rebate due for 2023-24. This ensures an immediate cash flow benefit to the recipient. By way of example, let’s assume the quarterly charges are £12.5 million and the rebate for 2023-24 is £5.0m. For Q3 2024-25, the net invoice values will be £7.5m. This approach complies with other industry bodies and ensures that all VAT is properly accounted for.
