Market Performance Operating Plan (MPOP) 2021/2022 Consultation - Authors: Matthew Labrum and Markus Lloyd - MOSL
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Market Performance Operating Plan (MPOP) 2021/2022 Consultation Authors: Matthew Labrum and Markus Lloyd 23 June 2021
Contents
1. Introduction .....................................................................................................................................................3
2. Key Risks and Issues.........................................................................................................................................5
2.1 Data Quality ..........................................................................................................................................6
2.2 Metering Issues and Accuracy of Settlement .....................................................................................10
2.3 Timely and accurate customer transfers (Switching) .........................................................................16
3. Market Assurance and the Review of the Market Performance Framework ...............................................19
4. Cost of Market Performance Framework ......................................................................................................20
5. Future direction of the Market Performance Operating Plan .......................................................................20
6. Next Steps ......................................................................................................................................................22
Appendix 1 .............................................................................................................................................................23
Summary of provisional Market Performance Committee 2021/22 objectives ...................................................23
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Version here | 16 June 2021 21. Introduction
The Market Performance Operating Plan (MPOP) sets out the market performance-related focus, priorities and
activities of the Market Operator, the Panel and the Market Performance Committee (MPC) for the year 1.
The purpose of the MPOP is to give visibility of the proposed market performance workplan (and associated
costs) to Trading Parties and ensure that the relevant priorities and activities are subject to regular review.
The MPOP for 2021/22 is built on the lessons learnt and progress made from delivering the MPOP for 2020/21,
alongside the findings from the 2020/21 Annual Market Performance Report (AMPR). The MPOP focuses on
improving trading party performance using the existing tools and incentives within the Market Performance
Framework (MPF). It also recognises the direction taken by the Improvement Programmes defined within
MOSL’s 3 Year Business Plan.
The key tools and incentives within the MPF which can be used by the MPOP are:
Monitoring and reporting of trading party performance against performance standards defined within
the MPF
Monitoring and reporting of trading party performance against Additional Performance Indicators
(APIs) defined by MOSL
Performance Charges incurred by trading parties for failing to meet defined performance standards
Reputational incentives such as peer comparison tables based on defined performance standards and
additional performance indicators
Performance Rectification & Intervention using Initial Performance Rectification Plans (IPRPs) and
Performance Rectification Plans (PRPs) to resolve trading party performance issues.
The MPC has established a MPF working group to progress the evolution of the MPF in line with its 3year
roadmap to provide a framework which delivers improved customer outcomes, with targeted risk-based
interventions and incentives which are better aligned to positive outcomes and are based on accountability.
The MPOP will follow the same principles and will recommend improvements to the MPF working group for
inclusion into the MPF.
The 3 year business plan improvement programmes, from which the MPOP will derive support in the form of
reporting and resource, are:
Bilateral Transaction Programme
Data Insights
The requirement for a Market Performance Operating Plan is outlined in the Wholesale Retail Code, CSD 0002 ‘market
1.2
performance framework’
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Version here | 16 June 2021 3 Strategic Metering Review
Market Assurance
Code Simplification
Assessing the MPF tools and Business Plan programmes, the AMPR confirmed that the MPOP 2021/22 will
focus on the following improvement areas:
Data quality. The MPOP will support core market data quality by monitoring performance against the
measures outlined in the Core Market Data Improvement Plan, including - but not limited to - the
completeness of Unique Property Reference Number (UPRN) and Valuation Office Agency (VOA) Billing
Authority Reference Number and issues with Geographical Information System (GIS) Coordinates
Metering issues. The MPOP will support the Strategic Metering Review by monitoring performance against
metering issues, such as the level of long unread meters
Vacancy. The MPOP will support efforts to reduce the level of vacancy in the market by monitoring
performance against vacancy issues, such as vacancy with consumption and vacancy arising from newly
registered supply points
Accuracy of estimation in settlement. The MPOP will support better use of Yearly Volume Estimates (YVE)
within settlement by monitoring of YVE performance and percent of actuals at R1-RF
Switching activity. The MPOP will provide for monitoring in relation to switching activity as the market
emerges from COVID-19.
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Version here | 16 June 2021 42. Key Risks and Issues
As outlined in our 2021-24 Business Plan, customers are central to our decision-making, meaning we need to
change how we address challenges to focus on better customer outcomes.
The impacts of COVID-19- have highlighted the need for accurate customer, premises, occupancy,
consumption and estimation data in the Central Market Operating System (CMOS). At any time, CMOS should
be able to inform with certainty, to all trading parties, the following:
The location of the premises and associated meter(s)
Whether the premises are occupied
If occupied, confirmation of who the occupant is
What sector does the business operate in
The ability to obtain accurate consumption data or estimate consumption.
With the above knowledge, this will also allow for the end customer to be serviced by the market adequately
and if they choose to switch supplier, the information above should allow for a seamless transition from one
retailer to another.
With the above in place, the retailer should be receiving an optimal service from wholesalers to enable it to
carry out the necessary levels of service for its customers.
The key risks and issues which are the focus of this year’s MPOP relate to those that hinder the ability for all
market participants to trade with certainty and deliver exemplary customer service. These are set out below:
Data quality
Metering issues
Vacancy
Accuracy of estimation in settlement
Switching activity
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Version here | 16 June 2021 52.1 Data Quality
Data quality covers core data items highlighted by the Core Market Data Improvement Plan. This includes the
accuracy and assurance of vacancy status, the accuracy and completeness of premises, and meter location
data. It also covers the definition of the customer at the premises, with an emphasis on name, address and
segment.
When the first lockdown commenced in April 2020, retailers had to make decisions on COVID-19 vacancy
based on customer data. Customer and sector information was key to determine the type of business which
would be subject to lockdown restrictions. We have already identified both UPRN and VOA items as key to
enable accurate premise and customer data within CMOS. Improving the quality and completeness of
premises and customer data is key focus of the MPOP 2021/22.
Addressing vacancy was a major focus for MPOP 2019/20 and will continue to be a focus this year. During the
initial lockdown, vacancy rates rose to a high of 35% when the vacancy flag was utilised to identify premises
that had to close due to government restrictions. In Q1 of 2021/22 vacancy rates have fallen to 17% as
guidance switched from the utilisation of the vacancy flag to the lowering of YVE and government restrictions
were eased. Despite the fall, a 17% vacancy rate is still high and trading party performance will be analysed
and reviewed, particularly for vacant premises with consumption.
New supply points, gap sites and change of use registrations are key processes as they introduce new
customers to the retail market. The processes are challenged by the difficulty of identifying and engaging with
the end user customers. Where such a user emerges as a household customer, urgent deregistration is
required to ensure that the customer is not incorrectly billed, and that growth of household customers does
not distort the data for the non-household market.
We want to ensure that all trading parties are adequately delivering on their obligations on supply point
registration, supply point data and supply point occupancy. We will not only review individual trading party
performance but also review whether it is impacted by specific bilateral performance and pairings. We will
look at whether service delivery performance is impacting key deliverables on data, registration and vacancy.
This may include a review of the various measures of experience from Developers Measure of Experience
survey (D-MeX), Retailers Measure of Experience Survey (R-MeX) and the forthcoming Business Measure of
Experience survey (B-MeX).
Inaccurate or missing supply point data impacts the following market participants:
The Customer: If the end customer is not identified in a timely manner or their meter is not located this can
result in poor customer service through inaccurate billing or delayed billing. There is also a risk that a customer
could miss out on important communications from a wholesaler in the event of an emergency.
The Retailer: If a retailer does not have access to core supply point data items, they cannot deliver a basic
service to the customer and their revenue is negatively impacted. This can also hinder the switching process,
with the receiving retailer picking up the costs of correcting erroneous data.
The Wholesaler: Timely and accurate settlement calculation may be impacted if the supply point data is
inaccurate or missing. In the event of an emergency or supply interruption event, the wholesaler needs to be
able to communicate to all affected customers. Poor occupancy or customer data may impede this alongside
the ability to assess supply demand and provide water efficiency.
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Version here | 16 June 2021 6Key areas of concern are:
A lack of completeness and accuracy of customer data at supply point registration can hinder a
retailer’s ability to verify premises, identify the occupier in a timely fashion and bring the customer
onto charge.
Temporary Building Supplies can remain in the market once the a site has been established within the
household market, distorting data and creating potential management and billing issues.
Completeness and accuracy of meter location data is required to facilitate meter reading.
Completeness and accuracy of premises data, specifically UPRN is a key building block to maintaining
data quality in CMOS. At May 2021 UPRN completeness was 53%.
Segmentation by Standard Industrial Classification (SIC) codes played a key role in underpinning the
decisions made around customer premises occupancy status in response to the pandemic. Bulk
changes to Yearly Volume Estimates (YVEs) may also be applied using SIC. Data quality in the area of
customer segmentation is not sufficiently high to allow trading parties or MOSL to assess the impact of
Government announcements regarding business restrictions.
Mitigation through the application of the Market Performance Framework
Monitoring and The following OPS measures will be focused on to provide a view on the provision of timely and
reporting of accurate Supply point data:
trading party
OPS B1a Meter Installation
performance
(OPS). OPS B3a Meter Accuracy Test – Site Visit
OPS B3b Meter Accuracy Test – Completion
OPS B5a Repair or replacement of a faulty meter performed by the wholesaler
OPS C1a Verification of meter details or meter supply arrangements
OPS C3a Verification of meter details or meter supply arrangements (retailer requested)
OPS C4a Missing Service Components identified by the wholesaler or the retailer (retailer
requested)
We may look to incorporate standards into a MO portal dashboard to monitor performance.
Monitoring and The following MPS measures focus on the provision of timely and accurate supply point
reporting of registrations:
trading party
MPS 1 Submit partial registration application (accept/reject SPID)
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Version here | 16 June 2021 7performance MPS 2 Submit core customer data
(MPS).
MPS 3 Submit new connection notification, by wholesaler
MPS 4 Submit new connection notification, by Accredited Entity
MPS 5 Submit gap site / Change of use notification
MPS 6 Declare disconnection/reconnection
Monitoring and The use of APIs to drive improvements in customer, premises and meter data quality has been
reporting of approved by the MPC. MOSL is developing dashboards to drive improvements in the following
trading party areas:
performance
Wholesaler API: Unique Property Reference Numbers (UPRN) and Valuation Office
(APIs)
Agency (VOA) Billing Authority Reference Number) completion with a target of 80%
Wholesaler API: the quality of Geographical Information System (GIS) Coordinates
Retailer API: reductions in premises which have an occupancy status of vacant and have
recorded consumption above a specified threshold.
Retailer API: for accurate and complete meter location under consideration
Retailer/wholesaler API: the reduction of Long unread meters (LUM) by Trading Party
Pairing
MOSL may consider launching new APIs via the Market Operator Portal dashboards.
The APIs referenced above may be passed to the MPF Working Group for possible inclusion in the
future MPF.
The possible introduction of a Temporary Building Supplies flag to assist in efficient deregistration
of household supply points will be assessed with the Retailer Wholesaler Group (RWG) and may
become supported by a Portal based report.
Performance Performance Charges will continue to be collected and re-distributed in relation to the defined
Charges. OPS and MPS set out in the market codes.
The MPF Working Group is assessing how proportionate the MO charges are and may consider
incentivising the performance against APIs.
Peer comparison. Each month, MOSL publishes on its website and to each trading party, peer comparison reports
showing performance against the MPS and OPS.
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Version here | 16 June 2021 8Peer comparison data in relation to the APIs is also made available to trading parties through the
MOSL portal. This information is also made available to the Panel, the MPC, Ofwat and the
Market Auditor.
The MOSL portal currently hosts the following dashboards which provides trading parties peer
comparison on:
Data Dashboards: Wholesaler and retailer completeness and accuracy peer comparison
across numerous data items
Vacancy Dashboards: Wholesaler and retailer performance on vacancy including pre-
market vacancy, new connections vacancy and post market vacancy.
Strategic metering review dashboards are in the process of being developed.
As the APIs develop under the MPOP, the Market Operator will explore how best the information
can be represented across the market. This may include the segmentation of trading parties by
size or by wholesaler and may be delivered through league tables or through interactive reporting
which allows selection and comparison of trading parties.
Performance Initial Performance Rectification Plans (IPRPs) are already established as a tool within the MPF
Rectification & and can be applied to improve performance against existing MPS and OPS standards.
Intervention.
Within the MPOP, MOSL may recommend to the MPF Working Group the application of IPRPs to
improve trading party performance to APIs, MOSL will continue to work with trading parties and
promote collaboration through paired improvement plans (PIPs) to resolve long unread meters
and vacancy. There may be scope to extend these to new data items, this will be considered
towards the end of the year following assessment of progress on data and vacancy rectification.
The existing mechanism for the escalation of rectification plans may be used where there is a
material failure to meet resolution milestones by the affected trading party or where no
rectification plan (or re-baselined rectification plan) is forthcoming. Parties that are escalated will
have their rectification delivery monitored by MOSL who will report this to the MPC and they may
be invited to provide the MPC with updates in relation to data quality action.
Additional considerations regarding the Market Audit
An audit of trading parties’ processes and controls in relation to registration and maintenance of vacant sites
may be undertaken in 21/22. This would provide assurance on the alignment of vacancy data held on the
Central Market Operating System (CMOS) and trading party systems.
The market auditor may be deployed to confirm CMOS and trading party systems vacancy alignment.
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Version here | 16 June 2021 9Mitigation through the Business Plan Improvement Programmes
Data Insight Improvement Programme: The MOSL business plan outlines our data insight improvement
programme together with the delivery outcomes and milestones for 2021/22. Understanding customer
segmentation is a key focus for this programme and it will be providing the MPOP with resource and guidance
in the building of the API dashboards.
Code Simplification: The current process by which a change in the occupancy status of a premises in CMOS is
requested and affected is complicated and has prevented timely changes to be made. Under Code
Simplification the MPOP will revise this process. While long term solutions may include the use of the Bilateral
Transaction Programme, the 2021/22 MPOP will explore more immediate options to simplify this process to
reduce the level of vacancy in the market through:
Improvements to the management of long-term vacancy via change proposal CPW106: ‘Management
of Long-Term Vacant Supply Points’.
A review and potential update to the Vacancy Change Application (VCA) process.
A review into the possible introduction of a mandatory Temporary Building Supplies (TBS) flag to
provide clarity around site usage.
MOSL with support from Retailer Wholesaler group (RWG) to review retail market eligibility of TBS.
MOSL with support from RWG to produce a Good Practice Guide on New Connection Data Submission.
Bilateral Transaction Programme: The opportunity to run the VCA within the Bilateral Transaction Programme
is a long-term possibility which would be outside the scope of the 2021/22 MPOP, but will be explored by
MPOP with possible support from the MPF Working Group.
Consultation Questions
2.1.1 Do you agree that the above existing measures mitigate the identified risks?
2.1.2 Do you agree that the MPOP proposals mitigate those risks not addressed by existing measures?
2.2 Metering Issues and Accuracy of Settlement
Over the last year we saw Yearly Volume Estimates (YVEs) used to represent changes to the occupation and
usage of premises in response to COVID-19. As restrictions are lifted, we need to ensure that “post lockdown”
settlement is not based on 2020/21 settings.
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Version here | 16 June 2021 10Similarly, the impact on meter reading performance during the numerous lockdowns has seen a rise in long
unread meters (LUMs). These are defined as meters which have not been read for more than 12 months and
their volume has risen from 148k pre COVID-19 (26 Mar 20) to 213k at the start of FY 2021/22.
We recognise three groupings; Pre-Covid 19 LUMs, Covid 19 LUMs driven by lockdown restrictions and Post-
Covid 19 LUMs driven by end customer failures. The reduction of LUMs in each group will be addressed
separately, recognising that meters which became long unread during and after COVID-19 may be indicative of
failing businesses and impending vacancies.
The accurate and timely reading and submitting of meter reads underpins consumption, settlement and
billing accuracy. COVID-19 has demonstrated the impact on these areas by the increased reliance on estimated
reads. The governance around the use of yearly volume estimates (YVEs), which can significantly influence the
calculation of an estimated read, is particularly important.
We want to ensure that all trading parties are adequately delivering on their obligations to ensure accurate
consumption data and estimation is captured in CMOS. We will not only review individual trading party
performance on meter reading and YVE submission but also bilateral performance, assistance in rectifiying
LUMs and the use of the deferrals process. We will investigate if service delivery performance is impacting
meter reading performance and settlement accuracy. This may include a review of the various measures of
experience from R-MeX and B-MeX.
Recording inaccurate consumption impacts the following key stakeholders:
The Customer: If a meter reading is missed and / or the estimation calculation is inaccurate the customer bill
may be inaccurate. In the case of sustained under-estimation, the charges could lead to a bill shock, disputes
with their retailer, switching restrictions and customer complaints.
The Retailer: The impact to the retailer of inaccurate settlement can lead to dispute and friction with their
wholesaler. This may result in the need for an unplanned settlement run (USR), adding costs to both trading
parties.
The Wholesaler: The impact to the wholesaler of inaccurate settlement can lead to dispute and friction with
their retailer and if a USR is required to resolve a billing dispute, it can lead to additional costs for both trading
parties. The reduction in LUMs may also be reliant on the wholesale’s ability to facilitate meter reading either
through confirmation of location or the repair of a broken meter.
Key areas of concern are:
Collection and submission in CMOS of timely and accurate meter readings.
Submission and retention of accurate YVEs as an adequate backstop in the event meter reads cannot
be obtained.
Accurate settlement based on actual reads.
The need to recognise that LUMs may now be indicative of failing customers.
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Version here | 16 June 2021 11Mitigation through the application of the Market Performance Framework
Monitoring and All operational performance charges were suspended March 2020 to relieve pressure on
reporting of trading parties, they were reinstated February 2021.
trading party
During the suspension period, MOSL continued to track performance.
performance
(OPS). COVID-19 has impacted the ability of trading parties to deliver in specific areas where the
lockdown restrictions restricted certain activities. Where restrictions are being lifted, market
performance will need to monitor the return to normal performance levels.
The following OPS measures will be focused on to provide a view on the provision of timely
and accurate consumption point data:
OPS B1a Meter Installation
OPS B3a Meter Accuracy Test – Site Visit
OPS B3b Meter Accuracy Test – Completion
OPS B5a Repair or replacement of a faulty meter performed by the wholesaler
OPS C1a Verification of meter details or meter supply arrangements
OPS C1b Verification of meter details or meter supply arrangements (wholesaler
Initiated)
OPS C3a Verification of meter details or meter supply arrangements (retailer
requested)
OPS H1a Application for an allowance
We may look to incorporate standards into a MO portal dashboard to monitor performance.
The incorporation of the Retailer Measure of Experience (R-MeX) into the MPF will allow for
a qualitative measure of wholesaler performance from a retailer perspective.
The positive customer impact of wholesaler task completion without deferral or delay will be
captured by the Business Customer Measure of Experience (B-MeX).
All market performance charges were suspended March 2020 to relieve pressure on trading
Monitoring and parties, they were reinstated in April 2021.
reporting of
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Version here | 16 June 2021 12trading party COVID-19 has impacted the ability of trading parties to meet their obligations, particularly in
the area of obtaining meter readings.
performance
(MPS). The following MPS measures are already established to drive provision of timely and
accurate consumption data:
MPS 7 Initial and final read submission by WSL
MPS 8 Initial and final read submission by Accredited Entity
MPS 9 Initial and final read submission for Private Water or Private Trade Effluent
meters
MPS 10 Submit meter read for disconnection/reconnection by WSL
MPS 11 Late Meter Read Submission by WSL
MPS 12 Submit cyclic non-market meter read
MPS 13 Take cyclic biannual non-market meter read
MPS 14 Take cyclic monthly non-market meter read
MPS 15 Submit cyclic market meter read
MPS 18 Take cyclic biannual market meter read
MPS 19 Take cyclic monthly market meter read
We may look to incorporate standards into a MO portal dashboard to monitor performance.
Monitoring and MOSL will expand the current reporting on use of YVE as well as comparisons of overall
reporting of settlement charges and consumption across settlement runs. It is possible that these will be
trading party developed into APIs during the year.
performance (APIs)
The original MO data on % of actual reads for each of the settlement runs, has been used to
develop interactive dashboards under the Data Insights Improvement Programme. MOSL is
building dashboards to provide trading party comparative performance around the % of
actual reads which support Settlement at the first reconciliation point (R1), and subsequent
reconciliation points of R2 (2 months after R1), R3 (8 months after R1) and the final
reconciliation point, RF (16 months after R1). The MPOP will focus on the creation of a set of
unified metrics which consider the % of actual reads supporting the settlement reconciliation
points, the parity between R1 and R3 and the parity between R3 and RF in terms of
consumption and settlement payment.
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Version here | 16 June 2021 13Reporting on Long Unread Meters (LUMs), defined as meters which have not been read for
more than 12 months, is already in place. MPOP will focus on the management of LUMs in
three categories:
Pre-COVID-19 LUMs: those meters defined as Long Unread before 26 Mar 20.
Identified as representing the list of LUMs which was gradually decreasing under
the paired improvement plans (PIPs) and reporting before the pandemic. Within
these meters will be those which have been unread since market opening
COVID-19 LUMs: those meters which became Long Unread between 26 Mar 20 and
15 May 21. Approximately half of these meters are listed as “internal” on CMOS and
some of these are representative of meter reader providers being unable to read
meters due to lockdown restrictions. Our focus will be to reduce the volume of
these meters as restrictions are eased.
Post COVID-19 LUMs: those meters which have become Long Unread after 15 May
21. These may be representative of customers who, after the lifting of furlough and
the end of restrictions on aggressive debt recovery procedures, have not been able
to re-open and resume trade. Our focus will be to understand which of these
meters remain Long Unread because of customer insolvency and which have
become read as restrictions are lifted and customers resume trading
The MPOP will establish APIs in some of these areas for 2021/22 to ensure that the customer
impact of the pandemic is understood and to ensure accurate consumption is recorded for
customers resuming trade after lockdown
Performance Performance Charges will continue to be collected and re-distributed in relation to the
Charges. defined OPS and MPS set out in the market codes.
Opportunities to apply charges based on liquidated damages for excessive under estimation
of settlement or for failure to locate meters leading to lost revenue will be assessed with the
MPF Working Group
Peer comparison. Each month, MOSL publishes on its website and sends to each trading party, peer
comparison reports showing performance against the MPS and OPS.
Peer comparison data in relation to the APIs cover OPS metrics such as overdue tasks is also
made available to trading parties through the MOSL portal. This information is also made
available to the Panel, the MPC, Ofwat and the Market Auditor.
The MOSL portal now hosts the data quality dashboards which provides trading parties peer
comparison on completeness and accuracy peer comparison across numerous data items,
including meter location GIS.
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Version here | 16 June 2021 14Strategic Metering Review dashboards are in the process of being developed.
A peer comparison report on the use of actual reads for settlement runs may be delivered
using the data from the portal dashboards.
Performance MOSL will continue to work with trading parties and promote collaboration through paired
Rectification & improvement plans (PIPs). There may be scope to extend these to YVEs if reporting reveals
Intervention. anomalies in practice which deviate from guidance or common standards. This will be
considered towards the end of the year following assessment of consumption accuracy.
MOSL will take rectification steps where performance in relation to the above MPS/OPS or
API measures falls below agreed thresholds. We will monitor performance and intervene
where appropriate to ensure that:
YVEs return to justifiable levels as COVID-19 restrictions are lifted
Volumes within the COVID-19 and Post COVID-19 LUM groupings reduce to allow an
accurate view of the pandemic’s impact and do not compound the “legacy” LUMs of
the pre-COVID-19 grouping.
The MPOP recognises that the impact of the pandemic on customers will vary based on
business type, size and location. This will preclude standard thresholds being applied to the
COVID-19 and post-COVID-19 LUM groups and to YVEs. Where clarity is required for such
areas, MPOP may employ the solution of requesting the trading party to either summarise its
approach or present its challenges and approach to the MPC.
The same approach may be used to expand the understanding around acceptable thresholds
for settlement runs R1-R3 and R3-RF parity
Additional considerations regarding the Market Audit
An audit of trading parties’ processes and controls in relation the application of YVEs and settlement run R1/R3
parity may be undertaken in 21/22. e.g. the use of the market auditor to compare customer bills with
settlement payments while observing and maintaining commercial confidentiality.
Mitigation through the Business Plan Improvement Programmes
Strategic Metering Review: The MOSL business plan outlines our Strategic Metering Review improvement
programme together with the delivery outcomes and milestones for 2021/22. This includes:
Formation of a new metering committee, reporting to Panel to guide the work of the strategic
metering review
Development of two strategic projects investigating roles & responsibilities in the market and
enhancing technology to improve availability of meter readings and consumption data
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Version here | 16 June 2021 15 Working with CGI to develop dashboards to help monitor read rejections and resolve issues
Reviewing the use of skip codes to understand why meters are not able to be read in the market
Considering ‘hard to read meters’ and defining potential solutions including the existing operational
approach, improved operational solution and the use of technology to provide a sustainable solution
An expectation for all trading parties to work together to increase reads to CMOS.
Consultation Questions
2.2.1 Do you agree that the above existing measures mitigate the identified risks?
2.2.2 Do you agree that the MPOP proposals mitigate those risks not addressed by existing measures?
2.3 Timely and accurate customer transfers (Switching)
One of the key functions of the retail market is to enable new customers to enter the market or to change
retail service providers. This market was set up to provide customer choice and enabling innovation. COVID-19
has placed a focus on the lack of switching activity in the market, which was already low before the pandemic,
but has now fallen from 75k in 2019/20 to 55k in 2020/21.
We want to undertake a holistic review of the switching process to confirm that:
The process works as it should,
Trading parties are meeting their obligations around customer transfers,
Delays to switches are understood
The customer is not being adversely impacted by either system or trading party issues.
Further information, including up-to-date information on customer switching and consumption categories is
available on the Market Charts page of the MOSL website. Issues with switching impacts the following market
participants:
The Customer: If the customers’ ability to switch is hindered this could result in poor service and potential for
increased costs to the customer. A switch from one provider to another should be a smooth and efficient
experience, with no disruption to billing accuracy. Without this, there is a risk to the reputation of the market.
The Retailer: Obstacles to switching customers prevent retailer growth, have revenue and customer billing
implications and restrict market competition. It may also increase market friction between retailers,
potentially resulting in disputes.
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Version here | 16 June 2021 16The Wholesaler: Errors or delays in the completion of bilateral tasks while customers await switching could
delay the customer’s switch, lead to friction and disputes between the wholesaler and incoming and outgoing
retailers and increase the cost to serve.
Key areas of concern are:
Quality and timeliness of switches, and any switch rejections. We need to ascertain that there are no
barriers to customer transfer in terms of process or trading party performance.
Quality of customer data at the point of switching to ensure that the receiving retailer has all
necessary information to effectively and efficiently serve the customer
Resolution of outstanding bilateral tasks before the customer switches. The risk of losing continuity of
service is high when a customer switches, especially if they are awaiting a read which is delayed by an
outstanding meter verification or repair task. Wholesaler engagement may therefore as important as
the bilateral engagement of both retailers.
Mitigation through the application of the Market Performance Framework
Monitoring and All operational performance charges were suspended March 2020 to relieve pressure on
reporting of trading parties, they were reinstated February 2021.
trading party
During the suspension period, MOSL continued to track performance.
performance
(OPS). COVID-19 has impacted the ability of trading parties to deliver in specific areas where the
lockdown restrictions restricted certain activities. Where restrictions are being lifted, market
performance will need to monitor the return to normal performance levels.
The following OPS measures will be focused on to provide a view on the provision of timely
and accurate customer transfers:
OPS F5a Non-Household Customer complaints – Response
OPS F5b Non-Household Customer complaints – Reasons for not responding
OPS I1a Temporary Disconnection requested by the retailer and performed by the
wholesaler in relation to Non-Household Customer non-payment (standard)
OPS I1b Temporary Disconnection requested by the retailer and performed by the
wholesaler in relation to Non-Household Customer non-payment (non-standard)
Monitoring and The following MPS measures focused on providing information on timely and accurate
reporting of customer transfers:
trading party
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Version here | 16 June 2021 17performance MPS 16 Submission of transfer read
(MPS).
MPS 17 Taking of transfer read
Monitoring and There are no specific APIs in place or being scoped. The customer switching process will
reporting of require considerable investigation to understand how best to identify improvements which
trading party will deliver a better customer outcome.
performance (APIs)
A Switching dashboard has been developed by the Data Insights programme which captures
completed and cancelled switches. MPOP will use the switching dashboard as a starting
point for the development of APIs
The MPOP will also look to assess the levels of data completeness at the point of switching,
as represented by the APIs developed by Data Insights, under the approach to the risk
identified as “Data Quality”
Performance MPS 16 and MPS 17 are subject to performance charges
Charges.
Peer comparison. Peer comparison is provided through the integration of MPS 17 and MPS 16 within the MPS
league tables. Switching volumes by trading party will be progressed with the Data Insights
Programme
Performance MPS 16 has been the focus of the only Performance Rectification Plan (PRP) raised directly
Rectification & with the MPC. A number of trading parties have experienced IPRPs for both standards.
Intervention. Investigations into the volume of cancelled switches and the volume of outstanding tasks
may provide a suitable basis for additional switching interventions.
Additional considerations regarding the Market Audit
There are no current considerations for market audit, there may be audit requirements that come to light later
in the year.
Mitigation through the Business Plan Improvement Programmes
Data Insight Improvement Programme: The Data Insights Programme has developed initial switching
dashboards on the portal. The expansion of these to cover individual trading party activities will be assessed.
Bilateral Transaction Programme: The opportunity to manage switches through the Bilateral Transaction
Programme will be investigated although incorporation of the switching process will not be possible within FY
2021/22
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Version here | 16 June 2021 18Consultation Questions
2.3.1 Do you agree that the above existing measures mitigate the identified risks?
2.3.2 Do you agree that the MPOP proposals mitigate those risks not addressed by existing measures?
3. Market Assurance and the Review of the Market Performance
Framework
Market Assurance
The MOSL business plan outlines our market assurance improvement programme together with the delivery
outcomes and milestones for 2021/22. This programme will bring improvements and changes to the way in
which MOSL delivers market assurance services and includes the evolution of the MPF (see below).
Integrated assurance will see MOSL adopt a more risk-based approach and move away from tactical changes,
with a focus on customer outcomes, accountabilities between wholesalers and retailers, and a smarter means
of using data and insight to drive higher quality intervention and rectification. In 2021/22, this includes the
development and implementation of a Strategic Market Risks and Issues Register - to drive focus and
improvement
Review of the Market Performance Framework
At the end of 2019, MOSL and the Market Performance Committee (MPC) commissioned a review of the
Market Performance Framework (MPF). The result was a three-year roadmap which identified the key
principles which would underpin an MPF fit for the continued improvement of the non-household water
market. The MPC had appointed a working group to progress the development of the MPF, but its initial work
was paused to focus on monitoring in light of COVID-19.
In January 2021 the Market Performance Framework Review working group reconvened to define the core
elements of the future MPF. The group agreed that the future MPF should better align to customer outcomes
and that all decisions in the design of the MPF should be made with a clear ‘line of sight’ to customer benefits.
The main features of the new MPF will ensure that:
Metrics will be aligned to customer outcomes – It will support interactions that improve the ability of
Trading Parties (TPs) to deliver benefits to customers and assess all elements of the MPF against both
market and customer impact criteria.Incentives will better reflect costs and benefits - Financial and
reputational incentives will become more targeted, in terms of the costs and benefits of changing
behaviour in both and the target audience in the latter.
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Version here | 16 June 2021 19Metrics will be appropriate to the desired outcome – both in the type of metric applied ie timeliness or
quality and the person accountable for the activity.
There will be a risk-based and tailored approach to all intervention – Interventions will be used where
the improved incentive regime has not resolved the issue and will reflect the frequency and severity of
the problem.
MPC Objectives
The Market Performance Committee (MPC) held a workshop on 27 May 2021 to assess how the MPC will fulfil
its objectives over the next year.
The focus was on the following:
What success would look likeHow it could be delivered
How those deliverables would be achieved
The MPC also considered the evaluation framework which success would be confirmed, communicated and
continued. A summary of the findings of the MPC are at Appendix 1.
Consultation Questions
3.1.1 Do you agree with the direction of the MPF review for the MPOP 2021/22?
3.1.2 If not why?
3.1.3 Are there any specific missing areas you would like the MPF review to cover
4. Cost of Market Performance Framework
Costs 2021-22
The cost of running the market performance function in 2020-21 was circa £443k figure (£1.188k 2019/20).
Cost reductions were achieved through the reduced spending on contractor resource and the reduction in
travel and meeting expenses.
The Market Performance budget for 2021-22 is expected to be broadly in line with last year’s spend.
5. Future direction of the Market Performance Operating Plan
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Version here | 16 June 2021 20The Market Performance Framework, code subsidiary document number CSD 0002 stipulates that the MPOP
will be published annually. For the last two years the MPOP has been published in June following the
publication of the AMPR.
Following feedback from trading parties regarding the volume of industry papers and consultations that they
are being asked to respond to, we believe there is a scope to consider a simplification of the publication
process.
Some trading parties have also expressed a preference to be given earlier insight of MOSL’s focus for the
forthcoming year.
We would like to review whether the market would benefit from the MPOP being published annually in Q4.
This would allow for the majority of trading parties to plan ahead of their financial year. In addition, if the
MPOP was incorporated into the annual MOSL Business Plan this could reduce the administrative
commitments on trading parties.
To allow MOSL to meet the deliverables set out in this year’s MPOP, we would recommend that the next
year’s MPOP is scheduled for Q4 , 2022/23. This would give us sufficient time to meet the objectives and
assess delivery.
These changes would require a code change.
In summary our considerations for change of the MPOP are as follows:
Commence MPOP planning in Q3 of FY 2022/23
Incorporate the MPOP 2022/23 into the MOSL Business Plan
Publish the MPOP 2022/23 within the MOSL Business Plan in Q4, 2022/23
The benefits of these proposals would be:
To reduce requirements on trading parties to respond to consultations and papers, at a point when
most trading parties are managing year end activities
To provide trading parties with the market performance and improvement focus ahead of time, this
would allow most trading parties to consider these before commencement of the new financial year.
Consultation Questions
5.1.1 Do you agree with the proposals to simplify the MPOP and incorporate into the MOSL Business Plan?
5.1.2 If not why?
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Version here | 16 June 2021 215.1.3 Are there any other suggestions around either the publication or simplification of the MPOP we should
consider?
6. Next Steps
We will analyse the results of the consultation and incorporate the findings into the finalised MPOP 2021-22
which will be published mid-August.
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Version here | 16 June 2021 22Appendix 1
Summary of provisional Market Performance Committee 2021/22 objectives
The following objectives were drawn up by the Market Performance Committee (MPC) at their May 2021.
These are currently draft objectives and will be finalised in due course.
Objective One: What success would look like
To clarify by the end of the financial year the new standards and framework for the MPF and have a
clear workplan for implementation in financial year 2022/23
The ability to be able to measure success
A workplan to be in place for 2022/23 by March 2022
Evidence that the MPC has assured the work of the MPF Working Group
Objective Two: How it could be delivered
To proactively monitor trading party and market performance
Where poor performance is identified take actions to rectify and escalate Trading Parties as required
and ensure this is done in a transparent manner to demonstrate the actions MPC was taking.
Key indicators determined based on their impact to customers
Ensure a clear process of escalation is in place and communicated to the market
MPC to obtain and publish Communication with the market with feedback from the market on the
approach taken to monitor and escalate performance issues
Objective Three: How those deliverables would be achieved
To review the requirement to monitor market entry and reassurance and how this may impact on
customers
Re-evaluation and improvement of meeting efficiency and working practices
Focused Agenda with clear objectives and outcome delivery measurements
Transparent easily accessible documentation to provide clear market visibility
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Version here | 16 June 2021 23You can also read
