As Market-wide Half-Hourly Settlement (MHHS) migration begins in earnest, we’re examining the impact for suppliers. Our recent analysis shows 59% of supplier processes are impacted by MHHS. But that’s only half the story.
We recently asked Helen Adey, Settlement Services Director at Elexon to offer insider knowledge of MHHS as part of our Expert Interview series. While our Client Director, Jon Vincent, shared his recommendations for suppliers. View the full podcast here.
Compliance or commercial opportunity
We’re moving from MHHS model theory to operation. It’s no longer a discussion about whether you’re ready for migration but whether your organisation can run efficiently and competitively. MHHS completely changes the economics of energy supply, not just the processes that support it. Shorter settlement windows and more granular data increase financial exposure that many suppliers aren’t accounting for.
We’re seeing a gap emerging between suppliers treating MHHS as a compliance exercise and those using it as a commercial opportunity. The biggest risk to suppliers isn’t technical failure; it’s being left behind by competitors.
As Jon puts it: “You will spend your time firefighting whilst your competitors are out there doing new and innovative things, and delivering new value to customers.”
Suppliers will miss commercial opportunities and struggle operationally by ignoring the wider impacts of MHHS on product, pricing, and customer strategy.
Suppliers need to be focusing on their commercial risks. That won’t come from the programme. That’s for businesses to manage themselves.
Jon Vincent
Client Director
Financial exposure
Reducing settlement timelines from 14-months to four months creates higher performance expectations, tighter operational tolerances, and greater dependency on third parties. Poor data quality or process failures carry a direct financial impact.
“MHHS is a change to how energy use is ultimately settled. It’s going to drive margin implications for products. They’ll all carry a pound number P&L impact if they’re wrong.” Jon Vincent, BFY
For suppliers to actively limit that financial exposure and commercial risk, means reassessing everything that MHHS makes viable at scale. Pricing models, product structures, and time-of-use tariffs.
Migration is the start, not the finish
One major risk is the temptation to tick the MHHS box once suppliers complete migration. There are significant operational and commercial demands ahead.
“Suppliers shouldn’t forget about what comes next. Work still needs to be done now during this migration phase. Suppliers need to make sure everything will work together and will function.” Jon Vincent, BFY
As Jon points out, there’s a real risk suppliers could get consumed by MHHS migration and lose sight of the larger operational implications. Operational changes which are easy to underestimate, but our analysis shows 59% of supplier processes will be impacted. As Jon puts it: “Everything needs to step up its game in terms of performance.”
59% of supplier processes are impacted by MHHS.
Jon Vincent
Client Director
Jon suggests reviewing future operating models, performance readiness and overall commercial strategy. It will mean significant work in process redesign, workforce retraining, and stronger third-party management to ensure everything works well.
Early adopter suppliers will be able to test operational accuracy with a lower risk of penalties. As Jon summarises: “Going early means you’ve got longer to practice, fine tune and optimise before that change comes in.”
Winning partnerships
Third-party management is also worth deeper consideration. MHHS was built collaboratively, shaped by industry working groups across suppliers, agents, and service providers to make it fit for purpose. The interconnected operating model is crucial to MHHS and will be a significant shift for suppliers. A shift that might surprise some.
"This is a big operating model change. It impacts customers and it impacts commercial arrangements with third parties. That’s a big risk for suppliers who aren’t thinking ahead and aren’t building true readiness for the new market." Jon Vincent, BFY
Where performance was once largely within a supplier’s own control, it now depends on how well the whole system functions together. Suppliers will succeed when they design their operating models around MHHS as a collaborative ecosystem, rather than treating it as an internal programme. That means stronger coordination across the value chain, faster issue resolution between parties, and more integrated ways of working.
The rewards for getting this right extend beyond individual supplier performance.
Those new settlement timeframes are going to be really demanding. But over time they are also going to drive efficiency and cost across the industry. We can really play our part here in making a difference for industry and for consumers.
Helen Adey
Elexon
Good MHHS vs great
Suppliers have a clear choice of paths to success. They can adjust compliantly, or they can comply and excel commercially. Jon and Helen categorise it as the difference between good and great.
Good adoption means stable operations, minimal customer disruption, controlled migration, and better data accuracy. But Jon clarifies that being good might not be good enough. Suppliers could you do more to take commercial advantage.
"If suppliers are just thinking ‘get through migration and then close it down’, they’re not thinking far enough ahead." Jon Vincent, BFY Group
Great adaptation means new products and customer propositions, closer collaboration with partners, better use of granular consumption data, and real customer value through demand shifting and cost optimisation. Suppliers who do that will be ready to attract new customers with new products, using MHHS to create new pull for smart and advanced meters. With commercial gains, of course.
And again, apart from the individual business benefit of thinking more strategically, Jon and Helen reinforce the wider industry impact: “It isn’t just to enable shorter settlement. It’s to enable consumer benefit.” Something we should all be striving for; reducing debt levels, helping more vulnerable customers, driving competition and meeting the clean power targets.
Questions every supplier should now be asking
Now is the time to take a step back and think strategically. Jon poses these questions to help shape supplier success over the next three years.
- What does your business need to be doing three years from now?
- What performance level do you need to be operating at?
- What capabilities does your organisation need to deliver that?
- And critically, is your MHHS programme delivering on those capabilities, or just getting you through migration?
Is your programme delivering the capabilities you’ll need three years from now, or just getting you through migration?
Jon Vincent
Client Director
Get ahead of MHHS for a competitive edge
MHHS is one of the most significant structural changes in the UK energy retail market. It’s often presented and viewed as a delivery challenge. However, suppliers who embrace the challenge can get ahead and create operational and commercial advantages. Suppliers who will come out ahead are those who build operational capability, manage commercial risk, and prepare to capitalise on what the new settlement model makes possible.
At BFY, we work with suppliers across the UK energy market to help them navigate these challenges. Whether you’re working through what MHHS means for your operations, reassessing your commercial strategy, or looking to get ahead of the next phase of migration, we can help.
Talk to Jon Vincent and the team today to find out how to turn MHHS into a commercial advantage, not just a compliance milestone.
Or download our free MHHS Engagement Framework to move from reactive communication to structured delivery.
