HV supply could make financial sense
The available supply tariffs could make it worthwhile to own transformers and pay for their upkeep. The calculation depended on the site’s demand and lifetime equipment costs.
Ownership, costs and the history behind adoption
How network adoption can reduce costs
and release asset value.
A licensed operator may buy qualifying HV equipment, pay your organisation and take on agreed upkeep. Understand why sites originally owned these networks, what changed, and how to assess the financial benefit.
Why sites originally owned their networks
Private ownership let sites choose
equipment and plan investment.
Taking supply at high voltage and running the equipment on site could suit a large organisation’s costs, layout and power requirements.
Equipment could match the site’s needs
Owners could design the private network around their buildings, critical services, backup power and future plans.
Owners controlled upkeep and investment
The owner planned and funded maintenance and replacement, subject to its safety duties and any required network-operator approvals.
The original decision may still be right for your site. A review checks whether an alternative now offers a better overall outcome.
How the market developed
Competition created
more ownership options.
Independent operators and connection providers became part of an established market. These dates explain the development; they do not determine a site’s eligibility.
Historical dates relate to Great Britain, with the 1990 restructuring described specifically for England and Wales. Northern Ireland has a different market framework.
1948
The regional electricity-board era
Electricity nationalisation established the public-sector system that preceded today’s network companies. This history does not mean that every transformer within a large site belonged to an electricity board.
Source 1 ↗1 April 1990
The industry is restructured
On 1 April 1990, the industry in England and Wales was restructured. The regional electricity companies were privatised later that year. This changed the industry’s organisation; it did not make every private site network operator-owned.
Source 2 ↗28 July 2000
A distinct distribution-licensing framework
The Utilities Act received Royal Assent. It introduced separate licensing of electricity distribution and supply, helping establish the framework within which independent distribution businesses operate.
Source 3 ↗26 July 2005
Independent operators have a regulatory framework
Ofgem published its decision on the long-term regulation of independent distribution network operators (IDNOs). This ownership is an established market model with a history measured in decades.
Source 4 ↗30 October 2015
Competition in connections is strengthened
New rules required regional network operators to make it easier for competitors to carry out connections work. This was a further step in a developing market, rather than the start of private network ownership.
Source 5 ↗What is different today?
An operator may pay for your assets
and take on their upkeep.
A licensed operator can earn revenue through network charges. Expected future revenue can support an asset payment; the operator then takes on the duties agreed for the equipment it acquires.
You may receive an asset payment
An independent network operator may pay for qualifying equipment, supported by expected future network revenue. The amount depends on the site and the offer.
Source 6 ↗Agreed maintenance costs can transfer
The operator may take on maintenance, operation and replacement of the assets it acquires. You remain responsible for retained equipment and duties.
Existing private networks: source 8 ↗Source 7 ↗Your network charges may change
A new metering or ownership arrangement can change the charges on your electricity bill. We compare the full proposed costs; a different tariff does not automatically mean a saving.
Where a benefit can come from
A payment upfront.
Potential savings each year.
The asset payment is a one-off receipt. Any annual saving comes from the difference between your current costs and the full costs after adoption.
What you could save each year
Current network charges and upkeep costs
minus
New network charges and costs you retain
What you could receive upfront
Payment offered for your assets
minus
Separate costs payable by your organisation
A payment is not a recurring saving. Any forecast needs to account for the proposed tariffs, retained duties, transaction costs and the evidence for your individual site.
You only benefit if the full comparison works.
A payment alone does not prove that adoption is worthwhile. We also consider ongoing charges, retained duties and operational requirements before presenting a recommendation.
Sources & further reading +
Historical milestones are supported by Parliament and Ofgem. SSE describes adoption of existing private networks. Eclipse and ESP describe the wider adoption model, including new or upgraded connections. None confirms eligibility or the terms of an Oxygen Energy offer.
- Parliament: electricity nationalisation in 1948 ↗
- House of Commons Library: privatisation and the 1990 restructuring ↗
- Ofgem: Utilities Act 2000 and separate distribution licensing ↗
- Ofgem: regulation of independent distribution network operators, 26 July 2005 ↗
- Ofgem: competition rules effective from 30 October 2015 ↗
- Eclipse Power: asset adoption payments and future network revenue ↗
- ESP Utilities: adopting, owning and maintaining networks ↗
- SSE Energy Solutions: adoption and management of existing private electricity networks ↗