Half‑hourly settlement a year on: what the reforms mean for businesses

The market‑wide half‑hourly settlement (MHHS) that Ofgem rolled out twelve months ago has fundamentally altered the way large UK businesses are billed, moving from flat‑rate, estimated charges to a granular, data‑driven model that reflects actual consumption in each half‑hour. For finance directors and operations leaders, the core thesis is simple: the new settlement regime creates both exposure and opportunity – exposure to more precise price signals, and opportunity to capture savings through flexibility, voltage optimisation and smarter supplier selection.

What MHHS changed

From half‑hourly to market‑wide settlement

Under the previous arrangement, only a minority of large customers with half‑hourly (HH) meters benefited from settlement that matched their actual usage to the half‑hourly market price. The rest were billed on a quarterly estimated basis, often leading to large variance between forecast and actual spend. MHHS extends HH settlement to all qualifying customers, regardless of meter type, by using smart‑meter data, advanced metering infrastructure and the NESO’s real‑time balancing platform. This aligns billing with the System Marginal Price (SMP) set in the balancing mechanism and brings the same transparency that generators have enjoyed for years.

Impact on billing and exposure

The immediate impact is a tighter link between consumption patterns and the wholesale price spikes that have characterised the post‑Covid, post‑Ukraine conflict market. Companies now see the cost of a peak half‑hour reflected on their invoice, rather than being smoothed over a quarter. This exposure can be managed – and monetised – through demand‑side response (DSR) and other flexibility services. The regulatory backdrop includes the SECR reporting obligations, the Capacity Market’s demand‑side participation rules and the Carbon Contracts Scheme (CCS) which rewards verified reductions.

New tariff opportunities

Flexibility services and TUS’s role

TUS Group currently manages over 150 GWh of flexibility under its flex‑management platform, beating supplier projections by 20 % in the last 12 months. By aggregating a portfolio of large users, TUS can offer capacity‑market‑ready bids that shave peak demand and earn revenue from the Capacity Market and the ancillary services market. Finance directors can tap this by signing a flex‑management agreement, which typically delivers a 3‑5 % reduction in total energy spend while providing an additional income stream.

Voltage optimisation

Another lever opened by MHHS is voltage optimisation. Because settlement now accounts for half‑hourly demand, even a modest reduction in voltage can translate into measurable cost savings. TUS’s optimisation service delivers 5‑15 % savings on electricity bills with a 2‑3 year payback, depending on the plant’s load profile. The service is delivered without capital outlay and is fully compliant with the Ofgem Voltage Optimisation Code of Practice.

Supplier panel and switching

MHHS also forces suppliers to price more competitively on a half‑hourly basis. TUS works with a 30‑plus supplier panel, enabling clients to benchmark offers against market rates. Using the free Yolk portal, businesses have achieved an average 27 % saving when switching contracts – a figure that reflects both lower half‑hourly rates and the removal of legacy “flat‑rate” uplift charges.

What to do if your contract still treats you like a non‑HH meter

Review contract terms

First, obtain a copy of your current electricity supply agreement and check the settlement methodology clause. If it references “quarterly estimated settlement” or “non‑HH pricing”, you are likely missing out on MHHS benefits. The contract may also contain a “price review” trigger that can be exercised to renegotiate on a half‑hourly basis.

Engage with a flex‑management partner

Second, engage a specialist such as TUS to conduct a rapid audit. Within 30 days we can map your half‑hourly consumption, model the financial impact of moving to MHHS and propose a flex‑management or voltage‑optimisation package. Our track record – beating supplier forecasts by 20 % and delivering 150 GWh of managed flexibility – provides a defensible business case to senior leadership.

Leverage the Yolk portal for switching

Finally, use the Yolk portal to run a blind‑bid against the 30‑plus supplier panel. The portal is free to use and presents offers in a comparable format, highlighting half‑hourly rates, capacity‑market charges and any ancillary service fees. A typical switch yields a 27 % reduction in total spend, but the real value lies in aligning your contract with the MHHS settlement framework.

Bottom line

MHHS has turned half‑hourly data from a niche capability into a market‑wide requirement, exposing large UK businesses to more accurate price signals while unlocking a suite of tariff‑optimisation tools. Finance directors who act now – by reviewing contracts, partnering with a flex‑management provider and exploiting voltage optimisation and supplier switching – can convert regulatory change into measurable cost savings and new revenue streams.