Blog Post

The importance of being a DCC user for Energy Suppliers

Matt Olney • May 05, 2020

Several energy suppliers have been hit with Final Orders by the energy regulator Ofgem for being in breach of the requirement to be Data Communications Company (DCC) users. We look at what the DCC is, and why it’s so important for energy suppliers to use it.

What is the Data Communications Company (DCC)?

The Data Communications Company has the responsibility of overseeing and managing the UK’s smart meter infrastructure and roll out.

Operating under license from Ofgem and the Department of Business Energy and Industrial Strategy (BEIS) it decides who builds and operates the smart meter infrastructure and awards contracts on behalf of the state.

It’s also responsible for the smooth running of the smart meter network and for linking all smart meters in homes and small businesses to energy suppliers, energy service companies and network operators.

The DCC is operated by Capita PLC with a licence regulated by Ofgem. They are technically a monopoly service provider, so there is a requirement for appropriate controls over their costs. They must also have an appropriate incentive regime that focuses on providing a good quality of service.

Why do Energy Suppliers need to be DCC users?

Energy suppliers need to demonstrate that they are DCC users and new entrants to the market must prove that they will work towards becoming users as soon as they possibly can. The reason being that not being a DCC user is a breach of licence conditions. Those that fail to comply are penalised by Ofgem.

To implement the Smart Metering Implementation Programme (SMIP), the Secretary of State for Energy (SoS), directed that energy supply and distribution licences should include mandated dates by which time various industry participants must be capable of using DCC services.

All energy suppliers were required to sign up to the DCC by Ofgem from 25 November 2017 to enable the enrolment of first-generation smart meters (SMETS1) and drive the installation of the next generation of smart meters - known as SMETS2.

If a supplier is not a DCC user, it cannot install second-generation smart meters for its customers.

All new suppliers will need to be DCC users as soon as possible and until they leave Controlled Market Entry (CME). New entrants will have to get in touch with the Ofgem Licensing team for more information or get in touch with the experts at Dyball for guidance.

The information checklist on what’s required to become a DCC user can be found on the Smart Energy Code website.

Failure to comply has consequences

Earlier this year nine companies were issued with Final Orders for failing to meet their DCC obligations. Until they became DCC users they were prevented from taking on new customers and began to rack up financial penalties.

The reason why Ofgem is so strict on the DCC issue is that due to the DCC being the only way to link smart meters in homes and small businesses with energy suppliers and network operators.

The smart meter rollout is already well behind schedule and with every energy supplier that fails to join the system adds further delays and barriers. A failure to join means that if customers switch to any non-compliant suppliers, they will lose the functionality of their smart meters.

DCC Adapters

A DCC Adapter is needed for energy suppliers to connect and communicate the DCC smart meter network.

They are designed to reduce and simplify the amount of IT development needed by an energy supplier’s internal systems.

To that end, Dyball Associates SaaS DCC Adapter aims to provide a simple, effective complete service that allows an energy supplier to concentrate on its core business activities.

Learn more about Dyball’s DCC Adaptor designed for energy suppliers HERE