25/07/2019: The week that was (w/c 15 July)

It all seems a bit of a while ago with all these change of PM goings on and the de facto creation of a new government (not a reshuffle, more a reinvention) and the slew of policy consultations that issued late Monday night. But here goes with last week’s standouts.

Then interim Energy and Clean Growth Minister Chris Skidmore attracted a few headlines when he appeared at the BEIS Select Committee on Tuesday 16th giving evidence as part of the cutting emissions to net zero by 2050. He said that, despite it only just being set, the 2050 target could be brought forward to 2045 as part of the first five-year review. He said it could be advanced if technologies developed enough to enable this. He also said that a review would enable the UK to compare its progress with other jurisdictions and keep up pressure on other countries.

But during Prime Ministers Questions on Wednesday, Labour Leader Jeremy Corbyn cited new analysis that claimed that government is based on current policies set to miss the existing target by 49 years. Emissions reduction had slowed to a crawl in recent years, he said, with carbon emissions falling only 1.5% in 2018, which is less than half the reduction of 3.2% in 2017. He also attacked the government’s air quality strategy. Needless to say, Theresa May at her penultimate appearance at the despatch box rubbished the claims, and we have now entered the parliamentary recess.

BEIS and Ofgem published a significant open letter addressed to the Energy Networks Association making recommendations last week on how energy networks can act on the Open Networks project. The letter “builds on” previous guidance set out in the joint smart, flexible workstream calls on ENA and its members to improve coordination around whole system network coordination and ensure that data is shared appropriately. The thrust of it was that network companies need to go faster and quicker if we are going to transition to DSO-style approaches. Couldn’t agree more.

In a move I strongly support, Solar Trade Association CEO Chris Hewett sent an open letter to the Big Six and other larger electricity suppliers last week in support of early delivery of export tariff offers to solar households in advance of the Smart Export Guarantee, scheduled for 1 January next year. The gap with closure of the FiT regime, which occurred on 31 March 2019, should be as brief as possible if built out of micro-gen is to be resumed. But we’re not holding our breath that there will be any response.

Citizens Advice released a striking new report on Friday titled Future for All outlining the need to reform the energy supply market to ensure customers – especially those that are disengaged – remain protected as the industry evolves, particularly in accessing new technologies. The research identified key issues around digital exclusion, financial barriers to access, and issues around consumer engagement and trust. It is a good, well-written report.

This release came ahead of the publication of change proposals (since issued) on among other things flexible retail markets and separately on code governance reform. The issue of a just transition is something we have written about before and is becoming front and centre of policy, especially given the recent establishment of Citizens’ Panels.

Activity on transport decarbonisation also continued apace last week. The government launched two consultations on electric vehicles, the first on changing building regulations to increase uptake, and the second on requirements for all new private charge-points to use smart technology. The first is a bold move, and could well be a world first; the second is sensible.

On the regional front, BEIS published the West of England Local Industrial Strategy, South East Midlands Economic and that for the Cambridge and Peterborough Combined Authority. There are short pieces on each on the New Anglia Energy website (http://bit.ly/2G4zD7W). They supplement those already issued by Greater Manchester Combined Authority and Humberside, with more due to issue over the coming weeks and months. What is notable here is the diversity in approach and specified target areas in meeting the government’s “grand challenges” under the Clean Growth Strategy.  

On the P379 front (my mod to allow meter splitting and multiple trading relationships with suppliers), we are gearing up for further working group meetings next week.

In this context it is welcome to see broadly supportive comments from Ofgem in a working paper on its key priorities for the design of reformed settlement arrangements is the need to be future-looking. It noted the importance of the target operating model (TOM) for electricity settlement being able to accommodate future reform, including changes such as P379 if approved and arrangements for multiple suppliers, and not act as a barrier to new technologies, products, and services.

Ofgem also said the TOM should allow for sub- metered data to be collected, and that consumption data of different meter and sub- metering points could be collected through consumer access devices. This is, of course, all very welcome.

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