Changes to how your energy supply will renew

Back in November 2015 we told you about the snappily titled “P272” legislation that was being brought in by Ofgem. This would affect anyone who had a Maximum Demand Supply – click here for that article.


Since then both suppliers and advisers have stumbled through the P272 fog.  Confusion has been created by the combination of a vague and pretty much undetailed piece of legislation, and the energy suppliers seeming inability to agree a route forward and tell all their staff about it!

The legislation itself is due to be fully implemented from April 2017.  At this point any supply that was previously a maximum demand supply will now become what is known as an half hourly supply. This means that when you next renew your supply it will be carried out in a much different way than before.


Up to now such supplies could be renewed following a comparison of matrix prices from a number of suppliers which gave you two main cost elements. These were price per kilowatt hour and a standing charge. By applying these rates to your annual usage you could see which supplier was the most competitive.

Now such supplies will have to be put out to tender, with prices to be received on a specific date. Those prices would then need to be analysed, presented, and the successful supplier to be picked on that same date. If this is not possible then prices would need to be requested again.

The new way of pricing shows many more elements as the costs for certain elements of the supply. Distribution, capacity, taxes, and levies are stripped out and quoted separately. Add to that the costs of monitoring and maintaining the meter and it makes for a much more complex process than ever before.


Experience is the key. We have found that the more of this type of supply we renew for our clients the easier it is to guide them through the minefield. Initial concerns can be partially allayed but unfortunately the truth is that the cost of your energy will rise.

If your supply is caught by this legislation then do not hesitate to contact us. We will be happy to discuss your particular requirements with you.


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