Energy management software provider Optima Energy Systems has predicted that business energy users could be left unprepared for changes implemented under Ofgem’s Targeted Charging Review.
Optima, which works with some of the largest energy users and consultants in the UK, has identified pass-through costs as major area of concern. It has warned that organisations need to urgently review their bill validation processes or they could be at risk of collectively wasting millions on incorrect energy bills.
Optima Energy Systems’ business development director Steve Kemp said, “The introduction of the Targeted Charging Review over the next two years means it will become increasingly important for organisations to check whether pass-through charges are being validated correctly. We know from experience that whenever new charges are implemented, this always results in a rise in billing errors.”
He continued: “It’s something that was probably historically overlooked or considered not that important when bill validation software was first developed, as pass-through costs only accounted for circa 30% of the delivered rate. But these costs are rising and now account for more than 50% of the total bill, and this will increase to as much as 60% in the future. With the changes being made, it is more important than ever to ensure all pass-through costs are being thoroughly and comprehensively validated. Not doing so could result major discrepancies in energy bills being missed by your software.”
Optima Energy Systems is an active participant at the Charging Futures Forum, run by National Grid. The forum is where users of the electricity network learn, contribute and shape the future of charging arrangements, including the Targeted Charging Review and the Access and Forward-Looking Charges Review. It will also be implementing the final decision on the Access and Forward-Looking Charges Review within the pass-through validation of invoices when it is introduced.