1. AQ Threshold Analysis
Steve Taylor Centrica plc

2. Details of analysis
This Analysis is based on BGT’s Small Supply Points (AQ<73,200) that had a new AQ calculated during the 2007 Annual Quantity Review.
The analysis investigates the effects of setting a percentage threshold for amending AQs.

3. Analysis Caveats:
This is Analysis is based purely on BGT’s portfolio and may or may not be representative of the whole market.
The 2007 AQR saw one of the largest average reductions in AQ for small supply points (averaged -4.3%*). It is questionable whether a drop to this extent will be seen again.
These results are based on the yearly AQR Frequency of AQ amendments, in a rolling AQ environment AQs are likely to change more frequently with smaller incremental changes.
*Value Sourced from the 2007 Mod 81 Stats report 10 where Previous EUC = XX:EXX01B and Current EUC = XX:EXX01B

4. Analysis Results
Absolute AQ movement is defined as the absolute value of:
(NEW AQ – OLD AQ) / (OLD AQ).
Posible movent if changes are < 4.3%

5. Shipper submits read to xoserve
What would be the benefits/costs of setting an AQ threshold on which small supply points AQs are not amended?
Rough Processes:
Shipper submits read to xoserve
Will be kept the same (No Benefit)
xoserve processes read and calculates AQ
Will be kept the same. (No Benefit)
xoserve sends a flow to shipper to notify of new AQ.
This will be replaced with a rejection flow with a code relating to threshold rejection. (Benefit ? New Cost ?)

6. xoserve to update thier systems with New AQ.
This will be removed, xoserve will no longer have to update their system as AQ hasn’t change (Benefit ?)
Shipper to update and validate their AQ records.
This would be replaced by Shipper validating/investigating the rejection reason. (Benefit? New Cost?)
AQs up to date with most recent consumption History.
Threshold restriction would cause less meters to have the most up to date AQ. (Benefit? Cost?).

7. Conclusions
To make sure the right decision is made, the costs/benefits of each one of these processes need to be calculated as a function of number of Meter Points and AQ movement. This would Help us chose what the threshold needs to be set to or whether to have one at all.
Currently no decision can be made from these statistics alone.