Consumers may have to pay for a bigger connection to the electricity network if they want to guarantee that they can charge vehicles at peak times. That could be one outcome of a planned review of network charging announced by regulator Ofgem, which has opened a consultation on the scope of a new charging regime.

The regulator is responding to changing use of the electricity grid, which has already seen large amounts of generation connecting to local low-voltage network. That trend that is expected to grow, alongside other significant new network users including electric vehicles and electric heating.

The grid will have to be strengthened to accommodate these changes, but regulator Ofgem says that unless there are changes in the regime that governs connections to the grid and the price of using it, consumers could end up footing the bill for expansion that is above and beyond what is needed.

The regulator wants to encourage efficient sharing of the grid, and a charging regime that uses ‘peak and off-peak’ options.

The regulator also wants customers to take decisions about what type of connection they want. That could mean individual domestic consumers paying extra to have a high-capacity connection, so they have the option of high usage – ie, charging electric vehicles – at peak times. Consumers could avoid the extra charge “if they are willing to be flexible about when, where and how they charge their EV,”Ofgem said, adding “We do not envisage these changes applying to households’ basic usage – we think this needs to be protected given it provides for essential needs.”

More broadly, customers could in future have to make decisions on the type of service they want from their electricity network connection. The regulator said that “often, capacity should be allocated to those that value it most”. This could involve providing choice over access options, whichcould allow customers with on-site storage or generation to opt for a cheaper, less-secure connection by changing their access rights.

The review of access rights may be devolved to the electricity System Operator and distribution network operators.

Ofgem is consulting on the scope of reforms. It will include so-called ‘use of system’ charges for both the transmission and distribution networks, including ensuring that they are consistent and encourage new connections to be made at the best voltage level.

That will include a review of the distribution ‘charging boundary’. At present electricity assets connected ‘behind the meter’ – do not bear charges for the public network. This allows considerable scope, for example on industrial sites where there may be several parties sharing generation and storage.  But Ofgem has been concerned that the regime allows some participants to avoid paying grid charges (which, based on the amount imported or exported, may be very low for those with on-site generation) while still having access to the network. In the long term, it fears, more and more of the costs of the network would fall on those unable to shift.

The regulator said changes to the connection charging boundary at distribution level would affect the allowed revenue which DNOs recover under the price control rather than directly from a connecting customer.

Ofgem expects to make decisions on the scope of the regime by the end of the year. If it decides to make changes to the connection boundary they will have to be clear in time to feed in to the DNOs’ next price control period.

See the consultation here