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Further Analysis on Meter Reading Validation Tolerances proposed by Project Nexus

March 2014

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Slide 2

Aim and data

• Aim of analysis:

– To provide further insight to how Nexus proposed read validations affect MPR’s across ranges of AQ.

• Data used in the analysis:

– MPRNs supplied by British Gas for the whole period 01/10/2012 to 01/10/2013.

– Single LDZ sampled .

– AQ’s below 293,000 kWh.

– MPRNs with meter exchanges in this period excluded.

– All reads where a URS10 flow showing acceptance by Xoserve under the current processing rules were used. No reads that were rejected under the current rules were used.

– This gave a data set of over 600k MPRNs and over 100k reads per month.

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Slide 3

Method

• Simulations were undertaken for the sample and extrapolated up to 23 million meter points (estimate of UK gas market including IGT’s) to assess:

1. Is there a consistency across all AQ values.

2. Is there a consistency for the reason for rejection based on upper or lower tolerance failure.

• Method

– 15 monthly iterations were run, in line with the monthly AQ timetable.

– For each month, reads were selected between the 10th of the preceding month and the 10th of the current month.

– Consumption between the previous accepted read and the current read was calculated and acceptance/rejection calculated based on the Nexus rules without any override flags(see appendix).

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Slide 4

Results 1

• Estimated average volumes of reads that would fail tolerances (extrapolated for the UK)

• AQ’s of 1 consistently fail.

• 67% of all tolerance failures are due to consumptions decreasing to much.

• Over 50% of all tolerance failures occur to MPR’s with an AQ less than 9,000 kWh. And 25% of all tolerance failures occur to supplies with AQ less than 3,000 kWh

AQ when tolerance failure

occurred

% of Average Tolerance Failures

per AQ band

Average Tolerance

Failures per month for UK

% of UK supplies with reads that failed due to % Currently accepted

reads that failed Tolerance check

Upper tolerence

Lower tolerance

above 73200 1% 4,309 4% 96% 0.22%

60001 to 73200 0% 1,579 20% 80% 0.08%

50001 to 60000 0% 1,563 20% 80% 0.08%

40001 to 50000 1% 2612 17% 83% 0.14%

30001 to 40000 2% 6483 16% 84% 0.34%20001 to 30000 8% 29,633 10% 90% 1.55%10001 to 20000 31% 122,617 10% 90% 6.40%9001 to 10000 5% 18,584 15% 85% 0.97%8001 to 9000 5% 18,253 19% 81% 0.95%7001 to 8000 5% 18,572 25% 75% 0.97%6001 to 7000 4% 17,493 31% 69% 0.91%5001 to 6000 4% 16,865 38% 62% 0.88%4001 to 5000 4% 16,889 47% 53% 0.88%3001 to 4000 5% 18,032 55% 45% 0.94%2001 to 3000 5% 18,979 64% 36% 0.99%1001 to 2000 6% 23,070 68% 32% 1.20%501 to 1000 3% 13,514 72% 28% 0.71%251 to 500 2% 8,193 67% 33% 0.43%

101 to 250 2% 7,04 65% 35% 0.37%2 to 100 3% 10,469 55% 45% 0.55%equals 1 4% 16,093 100% 0% 0.84%Grand Total 100% 390,808 33% 67% 20.39%

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Slide 5

Results 2

• No account has been taken for differing weather patterns within LDZ’s

• The following splits the failures due to upper and lower tolerance limits during each monthly calculation

• This is the pattern of rejections for supplies within a common LDZ and may be different between northern and southern LDZ based on weather patterns.

• The first calculation after the final “current AQ review” is exceptional, and thereafter there seems a distinct seasonal correlation

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Slide 6

Options for improved read validation business rules

• The following is intended to stimulate debate and is not an exhaustive list of options. With the intent being, to accept higher volumes of accurate reads without the use of override flags and or the AQ correction process once defined (for example AQ’s of 1 that should increase)

1. Within certain AQ ranges, accept the read if the annualised (on flat profile) consumption is in the same range. E.g. if the AQ is between 1 kWh and 30,000 kWh and the annualised consumption between the previous and current reads is also between 1 kWh and 30,000 kWh then accept the reading.

2. Apply different tolerances for different AQ ranges (low, mid, high). This would also require exceptional rules for specific cases, e.g. to allow reads to be accepted which show consumption where the AQ is low.

3. Change the tolerances based on season or experienced weather, to reduce high-end rejections over summer and low-end rejections in Autumn. This is a simple version of using the WAALP.

4. Change the market breaker rule to be both an absolute value and a percentage, so if the override flag is applied the read is accepted, unless e.g. the consumption is more than 700% what was expected AND over 500 GWh. The current market breaker rule will prevent an AQ change of e.g. 100 kWh to 10,000 kWh, which will not break the market.

5. When calculating the annualised consumption between two successive reads for tolerance application, include the use of WAALP’s in the calculation?

6. A combination of some of the above

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Appendix 1 Previous Presentation

Appendix 1 Previous Presentation (slides 1, 2, 3 and 4)Slide 1

Slide 2

Slide 3

Slide 4

© British Gas

Appendix 1 Previous Presentation

Appendix 1 Previous Presentation (slides 5, 6 and 7)Slide 5

Slide 6

Slide 7