Assessment and Design (A&D) fees

We continued to support and contribute to the national debate on the introduction of A&D fees and keep our customers informed of the outcomes. On conclusion of the industry-wide consultation, we implemented changes to our existing policies or practices and communicated these to our customers.

We carried forward a commitment made  in our previous year’s ICE plan, to continue to support the ongoing consultation on Connections Offer Expenses (also known as A&D fees) and to keep our customers informed of the outcomes. We said that we would make changes to our existing policy and processes, in response to new legislation being introduced, making the way we manage the cost of connections fairer.

Previously, irrespective of the complexity or number of applications made, all the costs associated with preparing connections offers were recovered from only those customers
who accepted an offer and proceeded with the connection.

Our customers told us and Ofgem they did not think this was fair and we agreed. We took action on behalf of our customers, playing an active role in the national working party that made the case to BEIS that DNOs should be able to charge a fee, for the work they undertake preparing quotations, to the individual making the request.

This action, which had the backing of industry stakeholders, led to new legislation which came into force on 6 April 2018.

We made sure that we kept our stakeholders and customers informed throughout the industry-wide consultation, with updates given at our Connections Customer Forums in April and November 2017, and at our ICP Seminar in June 2017. In March 2017, ahead of the introduction of A&D fees, we held a dedicated briefing for connections customers and ICPs to share our position. 28 stakeholders attended on the day. The slides that were presented at that briefing were published on our website and circulated via email to >6,000 connections customers and ICP contacts.

On 6 April 2018, when the legislation came into force, we introduced A&D fees for all of our connections activities, except for small works customers seeking a service connection, and sent an email to all our connections and ICP contacts with links to an open letter and new webpage where they could find more information. We expect to see a significant  reduction in the number of speculative applications we receive, which will free up our engineering resource to focus on projects that are more likely to proceed to energisation.

You can find out more about Connection Offer Expenses on our website at www.northernpowergrid.com/connection-offer-expenses