Market Wide Half-Hourly Settlement is coming
Published:
5-minute read
In recent years, Great Britain has felt the impact of the unpredictable and at times, volatile energy market. As a response, the government has introduced various policies and strategies to enhance energy security while progressing towards achieving net zero emissions by 2050. It's clear that to effectively decarbonise, significant transformation in the energy sector is needed to manage electricity more efficiently as Great Britain transitions to renewable energy sources and reduces its reliance on fossil fuels. Beyond just decarbonising, supply, consumption and how we engage with electricity needs to be revolutionised to make it more targeted, responsive and adaptable. Fundamental changes are needed and are coming with the Market Wide Half-Hourly Settlement Programme (MHHS): set to potentially accelerate the pathway to net zero and transform the electricity landscape into a smart and flexible energy system
What does MHHS mean for your business...
What does MHHS mean for you and your business and what do you need to do to prepare ahead of its implementation? Harry Wright, Change Manager here at TotalEnergies, explores MHHS, why it's been introduced and how these changes are set to impact consumers and what role there is to play in achieving net zero.
"In the ever-evolving landscape of the energy industry, the Market Wide Half-Hourly Settlement (MHHS) programme, is the most significant change to how the wholesale electricity market is settled since the introduction of the non-half hourly market in 1998. MHHS intends to revolutionise the way electricity consumed is settled across the industry and brings with it substantial change and benefits to consumers.
Let's start with the why...
The programme officially announced by Ofgem in April 2021, is set to be implemented in December 2026, and has clear, established drivers; To support the transition to Net Zero. To introduce a faster and more accurate electricity system, and to encourage a more flexible approach to how customers use energy. MHHS also aims to reduce power production through fossil fuels and, by extension, our carbon emission footprint.
What is Market Wide Half-Hourly Settlement?
In a nutshell, MHHS will see all customers being settled on their half-hourly electricity consumption. At present, half-hourly settlement is only required for industrial and commercial customers and if we analyse the model which exists today, most customers electricity usage is estimated based on pre-determined profile classes, so a one size fits all approach. With this, there is an often-reported common pitfall; inaccuracies in what is billed, in comparison to what is actually consumed.
The new target operating model (TOM) through MHHS will enable the flow of half-hourly data (meter reads), using advanced meters to record and convey real time usage data every 30 minutes. With this in place, businesses with half-hourly enabled meters will be provided with more detailed and accurate, real-time information about their energy consumption and usage, allowing them to make smarter choices with their usage and change their consumption behaviours.
This shift in behaviour would be beneficial as energy production becomes more intermittent in linking demand with generation as renewable sources start to play a bigger role. Behavioural changes can also be used to manage peak energy periods to reduce the strain on electricity networks ensuing less investment is needed that would be otherwise.
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