Update Call for Stakeholders

3 March 2016: Update call

Update call for stakeholders

This document summarises the key issues discussed during the 26th Open Water update call. These are regular calls that are open to stakeholders in the Open Water Programme[1]. The call was held on 3 March 2016 and was chaired by Adam Cooper, Ofwat. Also on the call was Ben Jeffs, MOSL.

Update from Ofwat (Adam Cooper)

Thanks for joining the call. A very challenging fortnight behind us and a significant amount of work ahead. Ben is back today, and will provide the MOSL update following my piece. [Followed by the questions on notice, before opening up the call to any further questions]

At a programme level:

· We published our fortnightly newsletter earlier in the week, and are happy to receive feedback on how useful this is. You may have noted that one of the things that RMOMG has undertaken to do is to publish the dashboard and the risk register following the March meeting in response to industry requests for more visibility around programme risks.

· The programme has also published a note on the CEO meeting, as well as the PMG position on the de-risking work raised by Thames on developer services and PA on data issues. I note that the DS work is now being progressed through the interim code panel, so if there are any views about this then I would urge you to contact your panel representative to make sure that they are taking into account. One of the concerns that has been raised is about the treatment of the commodity side.

From an Ofwat perspective:

The main Ofwat issue I wanted to raise today was in relation to the immediate changes to the WSL and the IoA. We have consulted on removing the in area trading ban and introducing a market readiness condition. We will issue the formal notices on this today, and while the removal of the IATB will follow the Section 13 and 17j processes, we will use s55 for the readiness condition.

· Using s55 for the readiness condition was always an option available to Ofwat.

· We are entering a critical phase of the programme where companies need to provide their data to MOSL and prepare their systems ready for the start of shadow market operation in October

· We are implementing the licence amendments this way to ensure that all companies have the same market readiness provisions, providing market participants with confidence that all other market participants are making the appropriate steps to be ready.

· It will also ensure that the provisions are in place with more certainty on the timelines, and it supports Ofwat’s intention to undertake a targeted review in the run up to the start of shadow operations in October (and the second industry assurance letter). To undertake the review we will need to start collecting data in May 2016 and so it will be important that the market readiness condition is introduced in a timely manner.

Credit Issues:

· On credit issues, we had intended to get a modification to the March ICP for discussion, but following a request at the workshop help on 19/2, we are going to do a little bit more work assessing the risk boundaries between wholesalers and retailers before finalising the modification proposal.

Independent Review

Finally, I want to update you on the Independent review. We have agreed the terms of reference and a broad timetable of events that takes the assessment through March with reporting in April. We will be assisting the team with setting up a range of interviews, and all of the delivery partners will be providing a range of documents for assessment ahead of these interviews. We will not be providing the independent panel with the assurance letter responses from Companies, but should anyone want to provide these directly then we can provide contact details if required. I will get a programme note out shortly outlining the terms of reference and process.

I will now hand over to Ben.

Update from MOSL (Ben Jeffs)

Programme Status

· As you will have hopefully seen, we issued an update to CEOs on Tuesday regarding the MOSL programme’s ‘red’ status

· We experienced a number of issues during the first phase of the CMOS build

· Due to the large number of issues we are facing, we realised we need a different response. By putting the programme status as ‘red,’ this allows us to escalate issues through the processes within MOSL and CGI to build greater confidence for the 4th April.

· None are insurmountable but they are collectively posing an increased threat to the current build phase. Phase 1 is most of the technical processes and systems that the market will open on.

· We have issued a note demonstrating what our response has been. We have put a number of measures in place to address the current challenges:

o Changes to the way we phase SIT

o CGI has trebled the test team size

o The steps both MOSL and CGI are taking to increase senior directorial support on the programme (CGI have deployed programme directors to ensure there is extra management support)

· We feel this is a proportionate response and we will be tracking it daily to ensure we are ready for 4th April. Over the next few weeks, once we see the results from the daily reports and confidence increases, then we may be able to reduce the status to amber. At the moment we are still on track for doing what is required.

· As I hope this demonstrates, we are taking the situation very seriously. I’m pleased to say that the whole team has responded very well and that we continue to work with CGO very productively

· The message was sent to CEOs and members of WRG and SRF simultaneously, which I hope worked better for your organisations

New IT Director

· We are pleased to have appointed a new IT Director, Samir Rahim

· Samir joins us from the The Big Lottery and is already making an impact on the programme. I know Samir is looking forward to meeting our members.

Issued since our last call…

· Wed 24th: we issued STS test scenario document, updated to include the scenarios that will be included as part of Phase 2

· Fri 26th: A suite of market entry assurance documents was issued, including trading application and application information return

· Mon 29th: Data operations paper issued. The paper is aimed primarily at members’ operational users and data architects. The document is being reviewed at the moment and we will issue v1.0 as soon as it is ready, but we’re conscious that you have asked for documents to be issued ASAP in draft if necessary.

o This hopefully gives you a clearer view of the environment as we go through to market opening. We have heard what you said about wanting an additional testing environment. We’re in the process of going through the impact assessment with CGI. Should it be necessary, we will come out with a consultation on that to see if members are happy with that cost.

· There has been a request for MOSL to start looking at bilaterals, specifically a standard that can be signed up to.

· We are looking at putting as process in place that will stop us publishing documents the night before a SIG. Data Assurance SIG 8th. If you can’t make it we will pick it up at WRG

Board

· We made a commitment to start publishing flash results for CEOs to help understand topics of conversation. I will clarify any questions you have on these.

· Next Board meeting (16th March) dedicated to MOSL structure and any gaps we have in it. We will take the Board through the market entry assurance programme and how it will be operated in practice. We have decided to use the same day to do the AGM. The two main focuses of the meeting will be to sign off auditors and our budget note. We would ask members to read the update note on the budget and the CEO update. The AGM is an opportunity for you to attend, or complete your proxies and send those in (these were circulated on Monday).

Revised WRG

· We held the February WRG last week. Following feedback we’ve taken the opportunity to review and revise the way we run WRG to reflect this is the senior ‘high-level’ engagement forum.

· We are moving into a year of implementation and need to tie in what MOSL and Ofwat are doing and how that ties into rolling it out. Please talk to your WRG member if you want to raise anything. We intend for the focus of the WRG to be reviewing progress, managing issues and directing work across the whole programme.

Questions on notice

(Adam Cooper): I have already addressed part of this question in my update. One part of the question was around data provision on live operation. Where we ended on a policy level was that we didn’t think it was appropriate to delay the live market information beyond the market start. We didn’t want to buy into the update on live approach. The data that is required is set out in the codes.

There was also a question around flexible load in shadow operation. PMG group confirmed there was no intent to alter the approach.

On refining of data characterisation and reconciling data discrepancies – this does not need new actions as this should be ongoing.

Take a look at the note and if there are any follow up questions we are happy to take those.

If you have a question you would like to ask, please send details to: .

Chair's summary

Adam Cooper thanked everybody for their participation and invited feedback on any aspect of the Update Call.

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