Access and Forward-Looking Charges SCR
Instrument type: Ofgem Significant Code Review
Launched: December 2018
Final decision: May 2022
Canonical source: sources/ofgem/access-scr-decision.md
What It Was
The Access and Forward-Looking Charges Significant Code Review (Access SCR) was Ofgem's overhaul of how electricity network users are charged for accessing and using the GB transmission and distribution networks. It ran from December 2018 to May 2022 and is the most consequential network charging reform in a decade.
Ofgem launched it because the existing charging framework was designed for large centralised generation feeding passive demand. By 2018, that model was breaking down. Distributed generation, battery storage, demand flexibility, and active network management were all growing, but the charging rules were creating perverse incentives - particularly Triad avoidance, where plant was being built partly to game the charging system rather than because it was efficient.
Legal basis: Standard Licence Condition 22 of the electricity distribution licence (Electricity Act 1989, s.6(1)(c)), with the Decision and Direction constituting notice under s.49A of the Electricity Act 1989.
Three Pillars
Pillar 1: Residual Charges Reform (Targeted Charging Review)
Decided separately in November 2019 (TCR Decision); implemented in 2022-23.
Before: Residual charges (the bulk of network costs - ~90% of TNUoS, ~50% of DUoS) were levied volumetrically (p/kWh). This incentivised avoidance: embedded generators and flexible demand could reduce charges by timing output to hit the three Triad half-hours.
After: Residual charges moved to fixed bands.
- DUoS residual: fixed bands from April 2022. Sites banded by supply capacity (kVA) or consumption. No volume incentive.
- TNUoS residual: standing charges from April 2023. Triad abolished. Sites banded by voltage and consumption.
Code modifications: CMP317/327 (CUSC) removed the Transmission Generator Residual credit for embedded generation. DCUSA modifications implemented DUoS banding.
Pillar 2: Distribution Connection Boundary Reform
Decided May 2022; implemented April 2023.
Before: Distribution demand connections faced a "shallowish" boundary - connectees paid sole-use extension assets plus a contribution to reinforcement up to one voltage level above their connection point.
After: Distribution demand connections moved to a "shallow" boundary. Connectees pay only for sole-use extension assets. Reinforcement costs are socialised across all DUoS payers. Distribution generation connections moved to a reduced shallowish boundary (reinforcement at connection voltage only).
Transmission connections were already shallow - no change.
Code modification: DCP406 (DCUSA), implemented April 2023.
Pillar 3: DUoS Forward-Looking Charges Reform
Directed by Ofgem; ongoing as of 2026.
Ofgem directed that DUoS forward-looking charges should better reflect the long-run marginal cost (LRMC) of network use, with stronger time-of-use signals and locational granularity down to primary substation level. The existing Common Distribution Charging Methodology (CDCM) and EDCM are to be replaced.
Status: stalled. The CDCM and EDCM models are producing technically volatile results. The DUoS SCR has been running for over six years without resolution. Implementation is dependent on REMA outcomes (see below).
Access Rights Reform
The May 2022 decision also standardised non-firm (curtailable) distribution access. DNOs must now offer non-firm connection options where curtailment can manage local constraints cost-effectively, with clear curtailment limits and end-dates. This aligns distribution access more closely with how some transmission connections already work.
CMA Appeal
SSE Generation and EDF Energy appealed CMP317/327 (removal of the Transmission Generator Residual) to the CMA. The CMA dismissed the appeal on 30 March 2021. SSE sought judicial review; the Court of Appeal issued judgment in November 2022, upholding the reforms. The residual decisions stand.
Impact on Embedded Generation and Storage
The combined effect of the Access SCR and related reforms fundamentally changed the economics of sub-100MW embedded plant:
- Triad avoidance eliminated. Value had reached ~£50/kW/year for well-timed plant. Now zero.
- Transmission Generator Residual credit removed. Embedded generators no longer receive a credit against TNUoS charges for notional avoided transmission costs.
- BSUoS exemption removed. CMP308 (separate but complementary) removed the BSUoS exemption for embedded generators. Added ~£2-3/MWh to costs.
- Distribution connection costs lowered. Shallow boundary reduces upfront costs for new demand and generation connections.
The combined cost reallocation across all three areas: approximately £2-3bn/year shifted from embedded/flexible plant (which lost avoidance value) toward all-user fixed charges, and from new connectees (lower connection costs) to existing DUoS payers.
Relationship to REMA
Ofgem's Review of Electricity Market Arrangements (REMA) is considering locational marginal pricing at transmission (zonal or nodal). If REMA introduces strong locational price signals at transmission, the interaction with distribution locational DUoS signals must be resolved - otherwise there is a risk of double-counting or contradictory signals. The Access SCR's DUoS forward-looking charges pillar cannot be finalised without knowing what REMA produces.
Key Cross-References
- CUSC - Connection and Use of System Code. CMP317/327/339 implemented TNUoS residual reform.
- DCUSA - Distribution Connection and Use of System Agreement. DCP406 implemented connection boundary reform.
- BSC - Balancing and Settlement Code. Consequential modifications.
- TNUoS Charging Methodology - Modified by residual reform.
- DUoS Charging Methodology - Subject to ongoing forward-looking reform.
- BSUoS Charging Methodology - CMP308 removed embedded generation exemption.
- Electricity Act 1989 - s.6(1)(c) distribution licence, s.49A SCR decisions.
- REMA - ongoing electricity market review, interacts with DUoS forward-looking pillar.