SECMP 0068: Alt HAN Company third party rights to enable external financing arrangements

Date raised 06/12/2018 Modifications Path Path 2 – Authority Determination
Current stage Modification Decision Overall status Awaiting Authority Determination
Refinement? No Urgent modification? No
Proposer name David Lyons Proposer's organisation E.ON

Summary

Following direction from the Alt HAN Forum, AltHANCo is investigating possible financing routes to spread and reduce in-year costs for Energy Suppliers. The need for AltHANCo to be given enforceable rights to receive payments from the DCC under the SEC would be required for all financing options. The key issue for this financing arrangement is the ability to assign rights to receive income to the funder, to provide the necessary comfort that their revenue stream is secure. As AltHANCo is not a party to the SEC, it does not currently have an enforceable contractual right to receive payment of the AltHANCo costs from the DCC, and therefore by extension it cannot assign these rights.

The proposed solution is to give AltHANCo Third Party Rights to enable it to enforce and assign its rights to receive payments from the DCC. This solution is the simplest, creates assignable and enforceable rights for AltHANCo against the DCC and (with Ofgem consent) licensed suppliers, limits AltHANCo exposure to other SEC obligations and will not bind AltHANCo to the prohibition on assignment of rights (Section M11.8). It also represents a similar approach to that used elsewhere in the Smart Meter programme as the DCC has previously used this structure for its financing activities.

The Proposer originally requested this modification be progressed as an Urgent Modification. Following the Panel's agreement to an expedited Modification Report Consultation, the Proposer withdrew this request.

Proposed implementation timetable

Panel considered Modification Proposal: 14 December 2018

Modification Report Consultation: 17 December 2018 - 21 December 2018

Change Board vote: 04 January 2019

Implementation date

Unknown

Documents

  • Modification Proposal Raised
  • Initial Modification Report
  • Refinement Process
  • Modification Report
  • Change Board Vote
  • Modification Decision
SECMP0068 Modification Proposal Form
06/12/2018
No files
No files
SECMP0068 Modification Report Consultation
17/12/2018
SECMP0068 Modification Report Consultation Responses
27/12/2018
SECMP0068 Final Modification Report
07/01/2019
SECMP0068 Change Board Vote
07/01/2019
No files

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