Market-wide Half Hourly Settlement: An Energy Opportunity, Not Burden

In recent years, both public and private organisations have faced the challenges posed by a volatile energy market. In response, the government has introduced various policies and strategies to enhance the UK’s energy security and accelerate progress towards achieving net zero emissions.

It has become increasingly evident that to effectively decarbonise the UK and enable organisations to benefit from a reliable, secure, and low-carbon energy system, a radical transformation of the energy sector is imperative.

Transitioning to more sustainable and intermittent renewable energy sources while reducing reliance on fossil fuels necessitates a more efficient management of all aspects of electricity. This shift requires us to not only focus on decarbonising energy generation but also to rethink how we source, trade, consume, and engage with electricity to make it more targeted, responsive, and flexible.

An instrumental driver of this energy revolution will be Market-wide Half Hourly Settlement (MHHS), a groundbreaking initiative initiated by Ofgem, the government-appointed energy market regulator. Positioned as one of the most significant transformations in the British electricity market since privatisation, the core objective of MHHS is to unlock more detailed and real-time data to understand the patterns of electricity consumption by all consumers.

So, how will the Market-wide Half Hourly Settlement impact public and private sector organisations?

Preparation for MHHS

Under MHHS, all organisations will transition to being settled on a half-hourly basis, eliminating the reliance on estimates and potentially inaccurate meter readings associated with outdated technology.

The industry’s roadmap for implementing MHHS commences in April 2025 and extends through 2026. The degree of change that organisations will experience depends on the type of meter in place. Entities with automated meter reading (AMR), Smart, or Half-Hourly meters may not require a meter upgrade.

Despite not mandating meter upgrades to AMR or Smart meters under MHHS, there are numerous benefits to doing so. These advanced meters allow for automated data extraction, providing accurate information for better energy management. This facilitates the identification of potential efficiencies and ensures that energy bills are based on actual consumption rather than estimates.

Furthermore, MHHS will enhance the availability of data, underscoring the importance for organisations to have a comprehensive understanding of their energy consumption.

There are user-friendly energy management platforms and innovative tools accessible that empower energy managers to monitor, analyse, and visualise their energy consumption efficiently. These platforms enable users to customise features, generate reports, set alerts, and compare sites to enhance efficiencies, reduce costs, and cut carbon emissions.

By leveraging platforms like our Intelligent Analytics tool, organisations can transform their data into actionable insights that can be utilised throughout the entity.

Unlocking Opportunities with Greater Accuracy

One of the primary advantages of the MHHS reform is the depth of insight it will provide. Once implemented, MHHS will offer unparalleled visibility into electricity consumption within every 30-minute interval, equating to 48 data points per UK meter every 24 hours.

This granular insight will support an energy system capable of forecasting, generating, and distributing electricity with enhanced accuracy and efficiency.

MHHS also promotes the flexible use of electricity, evident in the emergence of ‘time of use’ tariffs designed to incentivise energy consumption during periods of abundant supply and divert it away from peak-demand hours.

Consumers stand to gain from precise billing, access to new products and technologies, innovative offerings from suppliers, and an economically viable energy ecosystem.

Embracing a Dynamic and Responsive Energy Landscape

The energy sector is currently collaborating on the industry framework required to process vast amounts of data efficiently.

The roles of meter service providers are evolving, with new responsibilities emerging for the collection, analysis, and delivery of meter data.

For public and private sector organisations, proactively understanding their energy data and collaborating with meter operators and data service providers will be beneficial in readiness for this transformative change.

Although MHHS represents a significant shift in the energy sector, it also presents substantial opportunities, particularly in terms of enhanced flexibility, driving towards net zero emissions, and realising cost savings.

For additional information, please visit the dedicated MHHS information page on nBS’s website.

This article was featured in the June 2024 edition of Energy Manager magazine. Subscribe to stay updated on the latest industry insights.