SUPPLY BELOW MARKET PRICE
Supply below market price: additional calculations to be made by licensed supplier
19.—(1) In addition to the calculation required by paragraph (2) of regulation 11, in respect of each qualifying month the licensed supplier shall also calculate in the appropriate manner and in relation to each relevant category of electricity the aggregate amount (exclusive of the levy and value added tax) which would have been charged if the electricity in that category supplied by him during that month had been supplied at the market price.
(2) A copy of the calculation made in accordance with paragraph (1) shall be furnished to the Director at the same time as the licensed supplier furnishes him with the statement in accordance with regulation 12.
(3) Subject to paragraph (4), for the purposes of paragraph (1) the appropriate manner is given by the formula–
where–
A is the number of units of electricity in each relevant category supplied by the licensed supplier in the qualifying month;
Bj is the number of units of electricity purchased by the licensed supplier at grid supply points in each half hour during the qualifying month;
Cj is the market price applicable to that half hour during that month; and
j represents each half hour in that month.
(4) In any case where Σj Bj is zero, the appropriate manner for the purposes of paragraph (1) is given by the formula–
where–
A, Cj and j have the values or meanings given in paragraph (3); and
D is the number of half hours in the qualifying month.
(5) In this regulation and in regulations 20 and 21 “market price” means the price any licensed supplier would have had to pay for a unit of electricity purchased for delivery during the half hour in respect of which the calculation is being made and in relation to which no terms as to price, other than those at which any other licensed supplier would have been entitled to purchase that unit, are available.
Supply below market price: additional statements to be furnished to prescribed person
20.—(1) If any calculation in accordance with regulation 19 produces an amount which is higher than the comparable amount in the statement mentioned in regulation 12, the licensed supplier shall furnish the Director with a statement setting out–
(a)any price below the market price which he is charging for any electricity within the relevant category in question;
(b)the manner in which that price has been calculated; and
(c)any reasons which the supplier may have to justify a belief on his part that it is appropriate in all the circumstances for amounts payable by him in respect of the levy to be calculated by reference to that price.
(2) The statement mentioned in paragraph (1) shall be furnished to the Director at the same time as the licensed supplier furnishes him with the statement in accordance with regulation 12.
(3) The licensed supplier shall furnish the Director with a further statement on each occasion when there is a change in any matter set out in the statement mentioned in paragraph (1).
(4) A statement under paragraph (3) shall set out the change which has taken place, and the reasons for that change.
Supply below market price: action by prescribed person
21.—(1) The Director shall consider the matters set out in any statement furnished under regulation 20 and may require the licensed supplier to provide an auditor’s certificate as to whether–
(a)any price set out in such statement; and
(b)the manner in which that price has been calculated,
have been fairly stated and properly compiled.
(2) The Director may also serve notice on the licensed supplier requiring him to provide further reasons justifying any price below market price which the licensed supplier has set out in a statement under regulation 20.
(3) If the Director does not accept that it is appropriate in all the circumstances for amounts payable by the licensed supplier in respect of the levy to be calculated by reference to any price being charged for any electricity within the category in question he shall, within 28 days of the date upon which he received the statement or (if requested) the auditor’s certificate or further reasons, serve on the licensed supplier a notice under regulation 22.
(4) The Director may also, after considering any calculation furnished under regulation 19, by notice served on the licensed supplier require the supplier to furnish him with a statement setting out–
(a)any price which the licensed supplier is charging for any electricity within each relevant category;
(b)the manner in which that price has been calculated; and
(c)any reasons which the supplier may have to justify a belief on his part that it is appropriate in all the circumstances for amounts payable by him in respect of the levy to be calculated by reference to that price,
and the Director may also in like manner require the licensed supplier to provide an auditor’s certificate that any calculation so furnished is fairly stated and properly compiled.
(5) If, after having regard to any statement furnished under paragraph (4), and to any auditor’s certificate provided under that paragraph, the Director considers that any price charged by the licensed supplier is less than the price which the Director thinks it would be appropriate to charge for any electricity within the relevant category in question, he shall serve on the licensed supplier a notice under regulation 22.
(6) Any auditor’s certificate required to be provided under this regulation shall be provided as quickly as is reasonably practicable and in any event not more than 60 days after the date of the Director’s request.
Supply below market price: prescribed person’s notice
22.—(1) Subject to paragraphs (2) to (4) a notice served by the Director on a licensed supplier under this regulation shall set out–
(a)the Director’s reasons for not accepting that it is appropriate in all the circumstances for amounts payable by the supplier in respect of the levy to be calculated by reference to any price charged during the qualifying month or months in question for any electricity within the relevant category in question; and
(b)the price which the Director thinks it would be appropriate to charge for that purpose.
(2) When deciding what price to set out pursuant to sub-paragraph (b) of paragraph (1) in a notice under this regulation the Director shall in particular have regard to–
(a)the quantities of electricity being supplied by the licensed supplier;
(b)load factors;
(c)the voltage at which any supply is given;
(d)the time of year and the time of the day at which any supply is given;
(e)any conditions according to which a supply may be interrupted;
(f)the location of customers receiving a supply from the supplier;
(g)the date and duration of any agreement under which any customer is receiving a supply from the supplier.
(3) Any price set out pursuant to sub-paragraph (b) of paragraph (1) in a notice under this regulation served on a public electricity supplier shall not be so high as to cause the average charge per unit treated as charged by that supplier to exceed the maximum average charge per unit which he could make under the terms of his licence.
(4) No notice under this regulation in respect of a particular qualifying month may be served after the expiry of a period of 3 years commencing on the last day of the month in question.
Supply below market price: balancing payments in respect of levy
23.—(1) Upon receipt of a notice under regulation 22, the licensed supplier shall as quickly as practicable calculate the amount which would have been payable in respect of the relevant qualifying month, or each of the relevant qualifying months, if that amount had been calculated by reference to the price set out in that notice.
(2) As soon as he has completed the calculation mentioned in paragraph (1), the licensed supplier shall pay to the Director an amount equal to the difference between–
(a)the amount produced by that calculation; and
(b)the amount already due in respect of the levy in respect of the relevant qualifying month, or each of the relevant qualifying months,
(together with an amount in respect of interest in accordance with regulation 29(1)).
(3) At the same time as he makes a payment in accordance with paragraph (2) the licensed supplier shall furnish to the Director a statement of the manner in which he has calculated that payment.
(4) In this regulation “relevant qualifying month” means a qualifying month in respect of which the licensed supplier was due to make a payment pursuant to regulation 11 and in relation to which the Director has served a notice under regulation 22.