ELEXON Awards Logica Five Year Contract for Hosting and Operating the British Electricity Balancing and Settlement Systems
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ELEXON Awards Logica Five Year Contract for Hosting and Operating the British Electricity Balancing and Settlement Systems

30 April 2008

ELEXON has announced a strategic partnership with Logica by awarding a new five year contract for the Business Process Outsourcing, Hosting and Communications aspects of the Central Systems for electricity settlement and balancing. This contract, taking ELEXON to March 2014, is worth about £40m and delivers significant operational cost savings compared with our current contract. This has been achieved through a rigorous competitive procurement exercise which identified new technologies and more efficient processes to deliver cost reductions. The contract includes incentives to introduce further process efficiencies and innovation during the term.

The ELEXON Board of Directors approved the appointment of Logica in line with ELEXON’s strategic sourcing priorities of value for money, improved delivery of service and continuous improvement.

Speaking today, Stuart Senior, ELEXON’s Chief Executive said, “We feel that we can deliver best value to our customers by managing open and competitive procurements. Over thirty companies expressed an interest in tendering for this contract. Our main priorities were to secure value for money for our customers and ensure that any transition activities from the existing service to the new contract are delivered in a seamless and smooth way. 

Logica’s record in delivering robust central services over the past seven years speaks for itself. Going forward ELEXON and Logica will work in partnership to enhance the efficiency of the combined systems and make improvements.  As ELEXON’s costs are entirely recouped from BSC Parties we constantly strive to deliver better value for money and this new contract will help us do this.” he concluded.

"Commenting on the contract Judith Halkerston, Managing Director, Energy, Utilities and Telecoms said, “We are delighted to be working in partnership with ELEXON and this contract reinforces our strong position and heritage in the Energy and Utilities market. It also allows us to support ELEXON in facing its challenges as the market continues to evolve over the coming years. We are looking forward to the journey."

Note to Editors

  1. ELEXON is the Balancing and Settlement Code Company (BSCCo), established under the Balancing and Settlement Code (BSC). The BSC sets out the rules and governance arrangements for the balancing mechanism and imbalance settlement processes in the wholesale electricity market in Great Britain. ELEXON is a not-for-profit company: our costs are recouped from BSC Parties, i.e. the electricity companies that sign the BSC.
  2. The BSC Central Systems are those systems that enable the accurate financial settlement of the balancing and imbalance actions taken to ensure that supply meets demand on the British electricity system has enough supply to meet demand. During winter 2007/08, up to £160m flowed within these central systems each month.
  3. The existing contracts for the hosting and operation of the BSC Central Systems - Central Volume Allocation (CVA), Supplier Volume Allocation (SVA) and Funds Administration arrangements - terminate in March 2009. Recognising the criticality of these services to the electricity industry, ELEXON established a procurement project - Project Isis - in 2006 to deliver the combination of secure services, strong business partnership and innovation that we believe are necessary to take forward the BSC Central Systems across the coming years. 
  4. In the coming months, ELEXON will discuss the financial impact of this award with its customers and revise its 2008/09 Budget which will reduce as a result of the cost savings secured. In the immediate future ELEXON will engage its customers on the practical impact of this new contract, namely, in the short term, a replacement of the dated CVA Communications Network which facilitates the flow of information between the electricity generators and suppliers and Logica.  Logica will also deliver a full technology refresh because the current technology is nearing the end of its supported life: this upgrade will have no operational impact on customers.
  5. Further information regarding current and future ELEXON procurements is available from the Procurement and Project Isis sections of our website - www.elexon.co.uk.

About Logica
Logica is a leading IT and business services company, employing 39,000 people across 36 countries. It provides business consulting, systems integration, and IT and business process outsourcing services.  Logica works closely with its customers to release their potential - enabling change that increases their efficiency, accelerates growth and manages risk.  It applies its deep industry knowledge, technical excellence and global delivery expertise to help its customers build leadership positions in their markets. Logica is listed on both the London Stock Exchange and Euronext (Amsterdam) (LSE: LOG; Euronext: LOG). More information is available at www.logica.com

Press Contact:
Nadia Boodram
Logica
Tel: 020 7446 4152
Email: nadia.boodram@logica.com