---

Electricity (Standards of Performance) Regulations 2005

Answer

Under the guaranteed standard of performance for supply restoration following severe weather the time at which customers are entitled to compensation depends on the scale of the event. For medium-size events, customers are entitled to compensation once they have been off supply for 24 hours. For large weather events, customers are entitled to compensation once they have been off supply for 48 hours. For very large events consultation with the industry suggested that the restoration times that could reasonably be expected increased more than proportionally with the size of the event. Some companies suggested that a square factor was more representative. Therefore the period is calculated using the following formula: 48 hours x ( Number of customers affected 35% of customers ) 2 For any given distribution company the number of exposed customers is the number of customers supplied from mixed or overhead high-voltage circuits that may be affected by severe weather. For example, there are 270,000 exposed customers for WPD South-West. Suppose severe gales lead to 300,000 customers being interrupted in the WPD South-West area. The period when compensation is due will be: 48 hours x ( 300,000 270,000)= 59 hours. The formula reflects the impact of the scale of such events on reasonable restoration times. Events are excluded from the arrangements where more than 60 per cent of exposed customers are affected in any distributor's area. Sixty per cent of exposed customers for an average distributor is 500,000 customers. If there were no limit on the severity of weather covered by these arrangements, it is feasible that, for a very extreme event (such as the October 1987 storms), total compensation could run to many millions of pounds. The price control proposals cap each distributor's cost exposure to 2 per cent of revenue, so any compensation costs in excess of this would be passed through to customers. Without a limit on the size of event covered, an extremely severe storm could result in a significant rise in distribution charges in a subsequent year and substantial cross-subsidy between urban and rural customers.

Secondary information

Type

Written question

Reference

353; 673 c16-7WA

Session

2005-06

Subjects

Compensation Consumers Electricity Power failures Weather Standards Regional electricity companies

Legislation

Electricity (Standards of Performance) Regulations 2005

Contains statistics

Yes