Each year, National Grid publish the three half hourly periods when demand was at its highest between November and February. These periods, known as Triads, are used to calculate the transmission network charges (TNUoS) that some businesses have to pay. (You can read the P272 Hub guide to TNUoS here)
Businesses with half-hourly meters can choose to pass through some non-commodity costs, rather than paying a fixed charge. The amount these businesses pay is directly determined by the average volume of electricity they consumed during the three half hourly Triad periods, meaning many businesses actively try to reduce their volume during Triads by reducing consumption or shifting load outside of peak demand periods.
The shift to non-half hourly billing and settlement under P272 means that more businesses can choose to pass through TNUoS costs and, providing they take steps to reduce consumption during peak demand periods, potentially minimise their transmission network charges.
Predicting Triads might seem like a dark art, but by analysing factors such as weather patterns (including both temperature and wind speed), volume forecasts and demand factors, it is possible to predict when a Triad might occur. Many businesses rely on Triad warning services to help them know when to expect a Triad and reduce consumption accordingly.
More and more businesses are using demand side management as a way to avoid not only Triads but also “red bands” when distribution network (DUoS) costs are higher. Finding ways to reduce consumption between the hours of 16.00 and 19.00 on winter weekdays could make a big difference to businesses once P272 kicks in and half hourly settlement is a reality.
The Triad periods for winter 2015/16 were:
– Wednesday 25 November 2015, Period 35 (17:00-17:30)
– Tuesday 19 January 2016, Period 35 (17:00-17:30)
– Monday 15 February 2016, Period 37 (18:00 – 18:30)
Unusually, the Triad in February was two weeks later than any of Triad in the past eight years – most likely because the temperature in the second half of February was so much lower than the mild weather experienced by most of the UK at the start of the winter. The vast majority of Triads also occur between 17:00 and 17:30, meaning the 15 February was also unusually late in the day. You can find out more about the winter 15/16 Triads in this handy summary here.
TNUoS costs for businesses on pass through contracts are calculated on an individual basis, depending on the average consumption during the three half hourly periods. Most energy suppliers estimate what that demand will be and spread the TNUoS charge over 12 months. In April, once the Triad periods are confirmed and a business’ consumption is known, the actual charge is calculated and reconciled via a billing surcharge or rebate.
If you want to speak to an energy expert about how to prepare for half hourly billing and changes to how your charges are calculated, get in touch today.