The Energy Bills Discount Scheme Pass-through Requirement Regulations 2023

Calculation of pass-through amount

4.—(1) Subject to regulation 3(3), the requirement for a relevant intermediary to provide to end users a pass-through amount that is just and reasonable for the purposes of regulation 3(2) is treated as having been met in any case where—

(a) the relevant intermediary makes energy or energy products (or both) available through equipment where—

(i) tariffs per unit of energy or energy products (or both) used are automatically charged by the equipment, and

(ii) the energy or energy products (or both) are paid for by end users at the time that the energy or energy products (or both) are made available; and

(b) the relevant intermediary effects a pass-through by, as soon as reasonably practicable after the scheme benefit is provided to the relevant intermediary in accordance with regulation 3(5), adjusting the tariffs charged by the equipment—

(i) if there is one end user, to pass on the whole of the scheme benefit to that user, or

(ii) if there are multiple end users, to reflect the relevant intermediary’s reasonable assessment using best available information of the adjustment required to allocate the scheme benefit between those end users using one of the approaches described in paragraphs (2) or (3).

(2) Subject to regulation 3(3), where the relevant intermediary was charging end users at the point at which the scheme benefit was provided to it either—

(a) according to the proportion which each end user’s usage represents of the aggregate quantity of energy or energy products (or both) supplied or made available to the relevant intermediary which led to provision of the scheme benefit, or

(b) according to the proportion each end user pays of the total amount paid by the relevant intermediary in relation to the aggregate energy or energy products (or both) supplied or made available to the relevant intermediary which led to provision of the scheme benefit,

a pass-through amount is just and reasonable for the purposes of regulation 3(2), if the relevant intermediary applies the same approach to calculate the pass-through amount for each end user on this basis.

(3) Where paragraph (2) does not apply, in considering what is just and reasonable for the purposes of regulation 3(2), the relevant intermediary must apply the best available information to allocate the benefit amongst end users and in so doing may take into account the basis on which the relevant intermediary was allocating charges amongst end users at the point at which the scheme benefit was provided to it.

(4) When calculating the pass-through amount in accordance with this regulation, a relevant intermediary must take into account circumstances in which a person is an end user for part of a period, such that the pass-through to that end user relates only to that part of the relevant period in which they were an end user.

(5) A relevant intermediary is not required to pass-through to end users amounts in excess of the scheme benefit provided to it over the scheme period (as adjusted to take account of its own end user usage, where relevant).

(6) When calculating pass-through amounts, a relevant intermediary which is also an end user in respect of a scheme benefit provided to it must not retain more of the scheme benefit for itself than is proportionate to its own usage (or, if it is not practicable to assess the volume of its usage, the proportion of overall charges for energy or energy products (or both) borne by the relevant intermediary and its end users that the relevant intermediary itself bears).

(7) A relevant intermediary is entitled to include energy or energy products (or both) used to provide common services to end users as part of its own usage for the purposes of the calculation in paragraphs (2) or (3) to the extent that the cost of such energy or energy products (or both) is not or will not be borne by its end users as part of the arrangements in place when the scheme benefit was provided to the relevant intermediary in accordance with regulation 3(5).

(8) Paragraphs (9) or (10) apply where in a previous period a scheme benefit has been provided to a relevant intermediary and in the current period, as a result of a supply redetermination event, the relevant intermediary is provided (under regulation 24 of the EBDS Regulations, regulation 25 of the NI EBDS Regulations or paragraph (9) or (10)) with an SRE adjustment.

(9) If the SRE adjustment is an increase in the amount of scheme benefit in respect of the previous period, the relevant intermediary must adjust the pass-through amount calculated under this regulation 4 in respect of the current period to pass on such increase in the amount to the original end user.

(10) If the SRE adjustment is a reduction in the amount of scheme benefit in respect of the previous period, the relevant intermediary may adjust the pass-through amount calculated under this regulation 4 in respect of the current period by way of set-off to pass on such reduction in the amount to the original end user.

(11) Any adjustment of pass-through amount(s) made under paragraphs (9) or (10) must be just and reasonable and calculated in the same way as the pass-through amount were calculated for the original end user in the previous period concerned.