21 September 2020
The Weighting Factors that share out daily Unidentified Gas (UIG) will change on 1st October 2020.
What are the UIG Weighting Factors?
The UIG Weighting Factors are developed by the independent allocation of Unidentified Gas Expert (the “AUGE”) for each Gas Year. Unidentified Gas (UIG) is shared out each day on the basis of “weighted throughput”, calculated using these factors. The factors are also used to share out UIG Reconciliation on the Amendment Invoice.
How do the new weighting factors compare to the Gas Year 2019/20 values?
You may remember that the Weighting Factors for Gas Year 2019/20 were quite different to the previous year’s. This year the change is less marked, with End User Category 01 in Class 4 still attracting the highest weighting, but by a smaller margin than last year.
It is important to remember that it is not the size of any individual factor that is significant, but the relative size of all the factors compared to each other.
You can find the new Weighting Factors here: Gas Year 2020 UIG Weighting Factors.
Why have they changed?
The independent expert reviews its methodology and updates the factors each year. These factors were presented to the Uniform Network Code Committee in April, and in the absence of a unanimous vote to the contrary, they became the final Factors for Gas Year 2020.
Is this related to the change of service provider in the AUGE role?
This is the last set of UIG Weighting Factors prepared by the previous AUGE service provider (DNV GL). The new AUGE service provider (Engage Consulting) has already started work on the factors for Gas Year 2021, and they have presented details of their approach at recent UNC AUG Sub-Committee meetings. Details can be found on Joint Office website.
How will this affect my UIG allocation from October onwards?
Your UIG allocation depends on your portfolio share across the nine End User Category bands and the four Product Classes, the relative size of the Weighting Factors and the amount of UIG in each LDZ. UIG is the balancing figure in each LDZ and is not known until after the Gas Day.
For Gas Year 2020, as usual, there is a new set of Non-Daily Metered (NDM) parameters that are used in NDM Allocation (the Annual Load Profiles and Daily Adjustment Factors). This year the Demand Estimation Sub-Committee (DESC) took a conscious decision to exclude the last few days of March from the modelling process, to remove possible COVID-19 impacts from those days. DESC also decided not to apply uplifts to any of the models to try to mitigate UIG volatility. For Gas Year 2019 they had only retained the uplift of the Daily Adjustment Factors, which increased weather reactions slightly.
Also, for Gas Year 2020, the Gas Industry will start to use a new Seasonal Normal Weather basis, which will include a measure of Solar Radiation for the first time. You can find more information in Mark Perry’s recent Seasonal Normal Review Update.
The new NDM Parameters and Seasonal Normal Weather basis should help to improve UIG levels, but they are unlikely to be able to predict ongoing COVID-19 demand changes (either increases or decreases). The Autumn months of September and October often see more volatile UIG, as gas demand is much harder to predict and very susceptible to central heating switch-on dates for domestic and commercial properties.
Where can I find out more about UIG and how it is shared out?
If you have any questions about this update, please contact Fiona Cottam via the UIG Task Force email address.
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