AUGE Case Study

Engage Consulting has been retained since 2020 by Xoserve (the GB gas industry’s central data services provider) to act as the Allocation of Unidentified Gas Expert (AUGE). This role combines independent assurance and deep subject matter expertise to determine each year how much gas is likely to enter settlements that has not already been accounted for through standard industry processes, and then determine how this additional cost should be shared between gas shippers.

The determination of the unidentified gas across the entire GB network is a hugely technical and complex undertaking, requiring modelling, handling enormous data extracts, and extensive technical and process knowledge that spans gas settlements and distribution activities.  We must also present our findings in a way that is digestible to a non-expert audience, and support those findings with robust and unbiased arguments.  Engage has put together a delivery team of experts with complementary skillsets to meet these challenges, relying on regular stakeholder and client engagement to keep industry appraised of approach and progress, and to seek input to and validation of our assumptions. We structure this team flexibly to ensure high-quality delivery during busy periods and cost-effective resourcing during quieter periods in the AUGE calendar.

In our initial service year, we appraised previous allocation methodologies and in consultation with industry stakeholders developed a new end-to-end calculation methodology and model from the ground up. Our approach prioritises innovation and continual improvement, and we assess each year ways to improve our methodology on the basis of new information or changes to industry processes.

Understanding and balancing the views and commercial motivations of players operating in different customer segments is a key part of the role. However, our primary objectives are impartiality and fairness, so we focus on operating with openness and integrity, ensuring that our reasoning is clear and our messaging consistent.

The value we provide to stakeholders is in knowing that the allocation of costs between parties is impartial – given that these costs can be significant. We also offer advisory and innovation services, under which we act as a critical friend to industry parties seeking to improve industry processes and outcomes for their customers. Given the access we have to the data behind so many critical industry processes, our work has become a source of insight and recommendations for performance improvement and cost saving.

“Engage Consulting combine their deep understanding of settlements processes with a consistent and open approach to stakeholder engagement which has allowed them to overcome the early challenges associated with a change in methodology. The team at Engage continues to show the pragmatism and collaboration needed to provide this essential service to the gas industry at a time when the future of the AUGE service is uncertain.”

Chris Dwyer, Head of Contracts and Procurement, Xoserve

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