Utility Week

UTILITY WEEK | 28TH SEPTEMBER - 4TH OCTOBER 2018 | 9 Policy & Regulation This week Labour: water 'first for renationalisation' Shadow chancellor says the industry would be run by local councils, workers and customers John McDonnell has lined up water as the first industry Labour will bring back into public ownership. The shadow chancellor of the exchequer used his keynote speech at the Labour party con- ference on Monday to unveil the party's plans for a publicly owned water system. He said it would be run by local councils, workers and customers under a new ownership model that seeks to avoid the top-down, cen- tral control that characterised post-war nationalisation. McDonnell said: "Water bills have risen 40 per cent in real terms since privatisation. Water companies receive more in tax credits than they pay in tax. Each day enough water to meet the needs of 20 million people is lost due to leakages. With figures like that, we can't afford not to take them back." He said he and shadow business secretary Rebecca Long-Bailey will launch a large-scale consultation on improving democracy in the public services. And McDon- nell said there would be "unprecedented openness and transparency" in how the water industry will be managed. Responding to his announcement, a Water UK spokesperson said Labour had not answered any of the "big questions" about the risks involved in a government taking over and running water companies. "There's no explanation of how a government-run water industry would match or beat the ambitious plans for the future that we have set out, and there's still the serious risk that water would be a long way down the list of priorities for government funding, far below health and education." DB ENERGY Regulator orders Npower to take part in collective switch Ofgem has ordered big six energy supplier Npower to allow 100,000 of its customers to join a larger collective switching trial. The regulator wants the sup- plier to "co-operate fully" in the trial, which it says could help thousands of customers save hundreds of pounds by switch- ing to a better deal. Following the Competition and Markets Authority investi- gation into the energy market, Ofgem introduced powers to oblige suppliers to participate in its consumer engagement trials. Last month, Ofgem issued Npower with a formal direction requiring it to allow 100,000 customers on more expensive default deals for three years or more to take part in the next collective switch trial this winter. "Npower has so far refused to fully comply," Ofgem said. The regulator issued a provisional order to Npower on 24 September, which requires it to comply with the direction. ENERGY Cave to be Ofgem chair from 1 October The government has confirmed incoming Ofgem chair Martin Cave will take up his new position on 1 October. Cave has already joined the regulator as a non-executive director until he takes over from David Gray, who is retiring. Business secretary Greg Clark said: "We are determined to see active regulators who put consumers' interest at the heart of their work; the appointment of professor Cave to lead Ofgem will ensure that." Price cap champion Cave was a deputy chair of the Competi- tion Commission from 2012 until the watchdog was wound up in 2014. He also served as deputy chair on the panel that under- took the energy market review for the Competition and Markets Authority (CMA). ENVIRONMENT Labour: 'net zero' emissions by 2050 Labour has pledged to cut emissions to "net zero" by 2050 with new targets to dramatically increase the amount of wind power generation and eliminate fuel poverty. Rebecca Long-Bailey, shadow secretary of state for business and energy, used her keynote speech at the Labour party con- ference on 25 September to adopt the net zero target. She said: "The UK needs to do much more to meet the Paris Agreement goal of limiting warming to 1.5C. So today I state firmly that a Labour government will back a target for net zero emissions by 2050." McDonnell: 'can't afford not to' take back water Political Agenda David Blackman "The environment is one topic that unites Labour" Rancour has been the theme of any discussion about Labour over the past few weeks as the running sore of anti-Semitism allegations has clouded public perceptions of the UK's main opposition party. However the environment is one topic that unites Labour's fractured tribes. The party's environmentalists rallied on Monday night to toast ten years of the Climate Change Act, which the last Labour govern- ment passed in 2008. increased radicalism was its proposals to make water the first industry to be nationalised. But the greater boldness on climate change is likely to win a more sympathetic hearing from the sector. Perhaps just as importantly in the long term, McDonnell said Labour would bake environmen- tal considerations into decision- making at the Treasury, which has for many years been seen as the biggest block to action on climate change in Whitehall. The full spectrum of the par- ty's wings came out to celebrate, ranging from Blairites such as former shadow foreign secretary Hilary Benn to the former hard le MP Alan Simpson, who now advises shadow chancellor John McDonnell on energy and climate change issues. Tuesday saw shadow busi- ness and energy secretary Rebecca Long-Bailey's pledge to dramatically increase renewable power output as part of a wider bid to reduce UK emissions to "net zero" by 2050. The boldness of the ambition reflects how Labour is going for broke. For utilities, a less welcome manifestation of this

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