Utility Week

20 | 19TH - 25TH OCTOBER 2018 | UTILITY WEEK Operations & Assets perceive this traditional model as enough of an issue to intervene." Meanwhile, Lewis suggested the level of efficiency assumed in the cap will not be possible for some suppliers, as Ofgem itself "has recognised". "In our view that is not in line with what parliament passed in their bill," he said. Lewis also urged Ofgem to take another look at headroom – the amount above the efficient level of costs that suppliers are allowed to earn – to ensure it is sufficient to facilitate competition. "Above all we need to get the price cap working in the interests of consumers," he said. Eon further called on chancellor Philip Hammond to work with the industry in the forthcoming budget to "make sure a decen- tralised future energy system can deliver power, heat, mobility and comfort at an affordable price for consumers". Successful regulation In the panel debate about what successful regulation looks like, Ofwat chief executive Rachel Fletcher said there was no "simple answer". She was joined on stage by Ofgem's Nolan, Jenny Pyper, the chief executive of the Utility Regulator, which is responsible for regulating electricity, gas and water in Northern Ireland, and Catherine Waddams, professor at Norwich Business School, Uni- versity of East Anglia and expert adviser at the UK Regulators Network. The country has witnessed "impassioned debates" about the legitimacy of public utili- ties, how they are being run and in whose interests, Fletcher said. "I think it's abso- lutely right that we all stand back – regula- tors and companies alike – and stop and think about what success really looks like." She said the starting point should be customers rather than regulation. "When it comes to the provision of an essential service like water, people do care about corporate behaviours, about dividends, about executive pay." However, they also care about whether the company is providing a "social and environmental benefit". Although she said there is "no formula" for success, she did suggest that successful regulation involves "learning from experi- ence and mistakes, learning from others, trying new tools and partnerships and being open-minded and listening to criticisms from others". Nolan pondered whether a successful regulator is one that is "known or not known – in the news or not in the news". He also described how people differ in opinion on whether the regulator's success should be determined by how oen its actions lead to a court case. He said: "A very basic answer is that a successful regulator is one that protects con- sumers both in the short and the long term. It's very easy to say but much harder to do," he conceded. "In the utilities sector, trust and confi- dence has not been as high as we would have liked in the past few years." Nolan argued that a regulator must be independent but also "aware of the public mood". Pyper said: "Change is not just coming, it's here." She said it was important to be agile and embrace change to avoid playing catch-up. While discussing the carrot and stick approach to regulation, Pyper warned that you "cannot lose sight of the sticks", but sug- gested regulators should be an advocate for engagement. Providing a broader view, Waddams said that as with beauty, the definition of success is in "the eye of the beholder". She agreed regulators should enable innovation but suggested they "shouldn't be doing innovation and may need to get out of the way" at times. Waddams added that it is important to get the basic services right and that regula- tors are getting better at encouraging and are going "in the right direction". Regulation review Speaking on the second day of Congress, Sir John Armitt, chair of the NIC, said the very existence of regulators creates a "natural presumption against utilities". "One of the difficulties in the whole regu- lated sector is that the very existence of the HoloLens review Artificial intelligence is one of the most "exciting and profound tech- nological advances of our time," said Cindy Rose, chief executive of Microso UK who during day two of Utility Week Congress outlined a ra of technology that is going to transform how utilities work. She also highlighted how aug- mented reality was allowing work to be done remotely anywhere, by employees connecting to a central base and receiving instructions for complicated repairs, among other things. Through mixed reality, users can video-call their office where another employee will assist them in their tasks by advising on the cor- rect tools or pieces of equipment, allowing more experienced workers to assist those who may not have the relevant skills. Microso showcased its own HoloLens mixed reality technology throughout both days of Congress and Rose cited the example of municipal utility companies in the US using the equipment to guide field workers to locate underground pipes and cables and see through concrete. "Every day here in the UK, three billion litres of treated water are lost through leaking pipes. When you think about what this technol- ogy can do coupled with real-time data analytics from pumps and valves, you can really unlock huge efficiencies. "If you are a water supplier, anything obviously that lowers the chances of a leak is going to save you significant amounts of money." continued from previous page Utility Week Congress 2018 was sponsored by: ECONOMIC INSIGHT Master Logo CMYK X X X X X X X .5X 2 X .5X Artwork provided. Please do not recreate. Date : 31 I 01 I 2007 Title : Tata and TCS Marks - Stacked Design Magger : Gargi Sharma Project Co- ordinator : Vishal Jhunjhunwala Colour : Pantone 2427 C Software Formats : CorelDraw 11, Adobe Illustrator CS2 IMPORTANT : COLOURS USED TO CREATE THIS MECHANICAL ARE FOR VISUAL SUGGESTION ONLY. USE PANTONE COLOUR SWATCHES TO MATCH FOR CORRECT COLOURS. EVEN THOUGH THIS MECHANICAL HAS BEEN CHECKED FOR ACCURACY, PLEASE DOUBLE CHECK PRIOR TO RELEASE TO THE VENDOR. 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