Annual Quantity Manager

Summary

Key Features

Key Business Benefits

System Overview

AQR Industry Timeline

Flows Processed

 

Overview

Accurate and timely calculation of gas consumption is essential for any gas shipper in order to effectively manage critical transportation costs. Failure to pro-actively manage the Annual Quantity Review (AQR) process can significantly impact shipper profitability.

B-Smart™ AQ Review Manager provides the gas shipper with a complete managed end-to-end AQR solution. Based on configurable tolerance limits the application automatically challenges National Grid Transco (NGT) AQ or Winter Consumption (WC) notifications where the shipper’s own data indicates that the NGT value is inappropriate.

Generis’ own experience has shown that shippers can achieve substantial reductions in gas transportation charges by participating in the industry AQ Review process.

Central to the B-Smart™ AQ Review Manager is the integrated Consumption Estimation module. This module calculates AQ or WC values efficiently using standard industry standing data. Consumption data is sourced from either B-Smart™ Meter Asset Manager and Meter Reading Manager applications or any third party systems. Automatic tolerance comparisons between estimated consumptions and NGT notified values determines whether there are justifiable grounds to enter into an amendment or appeals process, eliminating user decision points and providing coverage of the entire meter point portfolio.

Tolerance checking is geared by meter consumption thresholds and may be driven by absolute or percentage differences in consumption values. This gives the shipper full flexibility to tailor the review process to any part of the portfolio and simultaneously satisfies industry compliance by ensuring that the shipper presents amendments in a balanced manner.

B-Smart™ AQ Review Manager is built on the market leading(1) B-Smart™ Flow Manager and B-Smart™ Event Manager technologies. The application can be implemented as a stand-alone solution or as part of a fully integrated B-Smart™ Dual Fuel supplier solution covering the management of Dataflow, Meter Assets, Supply Point Administration, Jobs and Third Party Contracts.

(1) B-Smart software manages an estimated 85% of the supplier gas meter asset data in the UK market place.

 

Impact of Code Modification 292

Overstated AQs have the potential to significantly impact on the profitability of a supply business especially given the fact that distribution transportation charging has moved to become 95% capacity driven.  Shippers, therefore, face charges that are determined mainly by the AQ at a site.  If there is a large negative differential between actual gas consumed and the site AQ value then there is potential for a shortfall in revenue from customer billing required to recoup transportation charges. 

For historical reasons the Network Code currently prevents shippers from amending small supply point (SSP) AQ values that are over or understated by less than 20%.  In practice this means that about 80% of the SSP AQ values cannot be challenged by shippers. 

Information published by Xoserve indicates that gas consumption is decreasing by 5% per annum and a 20% tolerance limits the ability of shippers to reflect this trend in a more representative site AQ.

Mod 292 proposes that a small supply point (SSP) tolerance of 5%, instead of the current 20%, will allow accurate AQ values to be established for a much greater proportion of sites and also lead to transporters having a better understanding of the network capacity needs.  A change to a 5% tolerance will inevitably lead to the potential for more amendments to be lodged in the SSP market. 

Estimates are that shippers may be able to amend around four times the number of SSP meter points with a 5% tolerance than can currently be amended with a 20% tolerance.

Mod 292 proposes that the transporter issues each shipper with a volume cap for the number of AQ amendments that can be submitted in each business day based on the number of meter points in the shipper portfolio subject to a de minimus level of 400 amendments per shipper per day.  The aim is to spread the load of amendments submitted to the transporter throughout the amendment window. 

Shippers will be required to submit amendments in a manner that does not breach the daily volume cap.  It is likely that the daily cap will be pitched so that SSP shippers will need to be able to submit amendments on every business day in the amendment window to take full advantage of the opportunity offered by the proposal.  It is likely that the increased volumes of submitted amendments and, consequently, an increased use of the speculative calculator, will present new business challenges to both shippers and transporters alike.

Summary

  • Management of the Annual Quantity (AQ) Review process including both Amendment & Appeal phases
  • Rapid business impact through immediate cost reductions
  • Retained knowledge base with the system maximises annual improvements and subsequent cost savings
  • Caters for Domestic and I&C Meter Points
  • In the process of being implemented within the UK utility sector
  • Pre-configured to process all UK-Link flows involved in the process
  • Can be deployed as a stand-alone application or seamlessly integrated with B-Smart™ Meter Asset Manager (MAM), B-Smart™ Supply Point Administration (SPA) and B-Smart™ Meter Reading Manager (MRM) to give a complete gas portfolio management solution
  • Built upon proven B-Smart™ Flow Engine & Event Management platform

 

Key Features

  • Manage large-scale operations by utilising the market established B-Smart™ Flow Manager transaction engine
  • Supports all AQ Amendment and Appeal activities between the shipper and National Grid Transco (NGT); Amendments, Appeals, Speculative Calculations, AQ and Winter Consumptions (WC)
  • Highly configurable consumption tolerances based on percentage and/or absolute consumption differences
  • In-built consumption estimation based on latest meter and reading details using the NGT algorithm
  • Automatic tracking of missing flows
  • Supports multiple in-house shippers within one instance of the application
  • Automatic triggering of re-nomination on successful appeal
  • Automatic adherence to the NGT AQ review timetable

 

Key Business Benefits

  • Rapid business impact through immediate cost reductions
  • Single system provides processing of a shipper’s total Domestic I&C Meter Portfolio including multiple in-house shippers
  • Allows the business to automate and proactively manage the complete AQ Review process
  • Allows full or selective portfolio processing of all AQ Review Amendment and Appeal activities between shipper and NGT
  • Provides a consistent and accurate approach to AQ Review, minimising manual intervention and associated costs
  • Configurability provides a flexible approach that delivers year on year business improvement
  • Retained knowledge base with the system maximises annual improvements and subsequent cost savings
  • Provides 14 pre-configured and Generis maintained industry flows with supporting business processes. This further reduces the cost of ownership

 

System Overview

AQR Industry

Appeal Process Summary

  • Process undertaken if shipper feels that the AQ/WC values issued by NGT are inappropriate given data that the shipper may possess
  • Initiated by receipt of the AQ/WC Notification flow (NRL)
  • This in turn initiates AQ Review business process and applies tolerance checks against the calculated AC or WC value and the supplied by NGT
  • Automatically requests an Appeal as appropriate
  • Triggers an automatic re-nomination request for accepted Appeals
  • Processing is configurable upon receipt of an Amendment Rejection; cancel business process or hold for manual intervention

 

Tolerance Checking Summary

  • Operates at Meter Point level
  • Highly configurable rules defined by the following:
  • Context
  • Sequence
  • Shipper
  • Current and Revised supply point class
  • Consumption amount lower and upper range limits
  • Percentage or absolute difference between two values
  • Can automatically cancel an AQ Review or hold it for user review

 

Amendment Process Summary

  • Shipper challenging the data that NGT used to calculate the AQ/WC values
  • Initiated by receipt of AQ Notification flows (NRQ, NRS, NRM) from NGT
  • This in turn initiates AQ Review business process and applies tolerance checks against the calculated AC or WC value and the supplied by NGT
  • Subsequently Performs an estimate before requesting Speculative Calculation
  • Automatically requests an Amendment as appropriate based on configurable parameters
  • Processing is configurable upon receipt of an Amendment Rejection; cancel business process or hold for manual intervention Initiates separate AQ and WC Amendment business processes as appropriate

 

Annual Quantity Review Industry Timeline

 

Flows Processed


Tel: +44 (0)161 499 7686