This webpage aims to support Suppliers in understanding the charges they’ll need to pay and how these are calculated to fund the Network Charging Compensation scheme (NCC).

Supplier Payments

It is anticipated Supplier charges will commence from March 2025. The amount each Supplier pays will be determined by their market share, generating funds used to compensate Energy Intensive Industries (EIIs) for the cost of their network charges.

These are the charges Suppliers will incur on a monthly basis:

  • EII Levy Payments – is the total amount of all of the sums determined for the associated claim month: This includes application, corrections to application and any dispute determinations.
  • EII Levy Administrator costs – is the EII Support Payments Administrator’s costs, and this includes establishing and operating processes.
  • Reserve Fund – is an amount that is twice the amount likely to be equal to the largest EII Support Payment Total to occur in the following 12 months. The Reserve Fund is initially accumulated over 12 months from Suppliers.

Elexon will charge Suppliers on a monthly basis with a five working day payment term in place.

How are Suppliers payments calculated?

Elexon will calculate the payments based on Suppliers market share data, using the Suppliers chargeable demand (excluding any EII exemptible demand). Where Suppliers have customers that are EIIs, their demand is exempt from the data used.

When we calculate the Suppliers payments in March 2025, this will use the Suppliers chargeable demand from April 2024.

This will use the latest data available and most likely using R3 settlement run data. The market share data used in the calculation is not subsequently reconciled when more settlement run data is received.

What happens if a Supplier fails to pay?

If at least one electricity Supplier fails to pay some or all Supplier payments due and the shortfall exceeds the amount held in the Reserve Fund, Elexon will be required to impose a mutualisation charge. Suppliers will be notified as soon as possible if a mutualisation charge is to be imposed.

Additionally, Late Payment Interest is applied when a Supplier does not make all or some of the due payments. Elexon will apply the Late Payment Interest at the rate of 5% per annum over the relevant Bank of England base rate. This is applied from the day after the payment due date.

Late Payment Interest is taken twice a year for a six-month period:

  • Taken on 31 December for the period January to June
  • Taken on 30 June for the period July to December

Publication of the Estimated Levy Fund

We will calculate the Estimated Levy Fund six months following the claim month. This provides an estimate of the monies that will be paid out to compensate EIIs for their network charges.

To view the monthly Estimated Levy Fund please visit this designated webpage:

Further information

You can watch a recording of our webinar, which covered numerous topics including a progress update, EII application process, application evidence, Estimated Levy Fund, Supplier Charges and Elexon Support.

You can also download the presentation slides, and the questions raised during the webinar.

Information for Energy Intensive Industries (EIIs)

If you would like to understand more about the registration and application process for EIIs, please visit this webpage.

Enquiries

For all enquiries regarding this scheme, please use Elexon Support.

You will need to register with Elexon Support ahead of submitting an enquiry. By registering an account, you will receive email updates on the progress of your case and can view and track other cases you submit. This also provides a historical view of the cases raised.