UK Power Networks, the distribution network operator for South East England, East England, and London, has announced their plans to introduce an upfront design and assessment fee for their larger “Demand” connection requests. What does this mean for your future projects? Read on for full details on who this applies to, why the fee has been put into place, and how you can avoid paying it unnecessarily.

The new design and assessment fee - what and why

As one of the UK’s fourteen distribution network operators, UK Power Networks (UKPN) receives a high volume of speculative quote requests for new connections. In the majority of cases, such as for smaller capacity high voltage projects and all low voltage projects, responding to these requests is a fairly straightforward process. However, for projects with a capacity of more than 1MVA, preparing a quote can take hours of work including visits to the site.

For this reason, UKPN has instituted a fee to evenly spread the cost of their design and assessment services across everyone who requests them. While these types of fees are relatively new to the energy industry, they are more common among the water utilities. We would not be surprised to see other district network operators follow in their footsteps.  

From 13 February, the new UKPN fee structure will be:

(The appropriate up-front fee is included in their Common Connection Charging Methodology Statement (CCCMS))

The new design and assessment fee - what this means for our clients

As part of our standard process, we review all new connection plans with an eye to ensuring they are fit for purpose. In cases where the work has been over-specified, we work with you to right-size the project and avoid unnecessary fees, such as this one. If the job has been under-specified based on our understanding of the project scope, we can address this before it becomes a very costly mistake down the line.

Predominantly, we expect our customers with larger commercial installations in the designated areas will meet the criteria for the new fee. We will take the fee into consideration when requesting design and quotation work, and will only include UKPN where it makes sense.

Although no one wants to see costs increase, in this case, the fee should be viewed through a positive lens. First, it should reduce the number of overall requests by eliminating anyone who isn’t seriously considering awarding the work to UKPN. Of those remaining, with everyone paying their fair share, UKPN expects to see service improvements. 

If you have any questions about this fee change or any other part of the Demand connection process, get in touch.