Thanks Rich,
I've been making a few tweeks to it following our recent games, the current use for it is as follows:
There are 3 Danger levels in play, each one corresponds to a counter. The levels it at:
Counter Level 1-10 = Danger Level 1
Counter Level 11-15 = Danger Level 2
Counter Level 16-20 = Danger Level 3
Each turn the counter is moved up 1 point, encounters can also speed up the counter (ie in a stealth based scenario the heroes may have to take a DG test to carry out an activity, failing it may make some noise which makes the scenario more dangerous) Encounters usually ass 1 to 2 points to the counter depending on how harsh I'm feeling.
The counter is moved down for each enemy killed (We normally play our scenarios as me as the villain/GM and everyone else as the "heroes" so enemies refer to my hoard of mooks)
The Actual Danger level corresponds to encounter cards, the difficulty of tests for encounters is based on the current danger level.
For example, to make an encounter hard to complete early in the game the difficulty is set to Danger level 1 - 14+, Danger Level 2 - 12+, Danger Level 3 - 10+. This way the game generally doesn't finish quickly if the heroes find the right encounter too early in the game.
On the flip side the random enemy encounters may read: Danger Level 1 - Just 1 Patrolling Mook appears, Danger Level 2 - 2 Patrolling Mooks appear, and Danger Level 3 - a hoard of mooks appear ready for battle.
So far it seems to give the right balance of danger vs reward.