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Network March 2019

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NETWORK / 9 / MARCH 2019 Decarbonisation of transport: With the UK widely thought to be approaching the tipping point for the mass take up of electric vehicles, the energy networks are poised for a once-in- a-generation rollout of new infrastructure to support charging, with all the investment and innovation that will entail. EVs also bring potential benefits for networks by acting as sources of storage and flexibility. Meanwhile, new solutions for low-carbon transport are emerging from the gas sector, as well. Network will explore the latest thinking on the decarbonisa- tion of transport, the challenges and opportunities, and ask - are networks ready? Paying for the networks – RIIO2 and network charging: With Ofgem recently publishing plans to slash in half the returns that energy networks can make, it's clear that RIIO2 is going to be a challenging settlement. It comes at a time of seismic change for networks, and the framework will need to allow flexibility for changing circumstances while also providing the certainty networks need to secure investment and run their businesses efficiently. Network will share reflections on the emerging RIIO2 framework and what it means in practice for businesses. We'll also be looking at the ongoing reforms to network charging and how they will impact the behaviour of network users. Decarbonisation of heat: The UK has resolved, by 2050, to reduce carbon emissions by 80 per cent of their level in 1990. Developments have also been made on the heat side and there's currently trials involving blending hydrogen into the gas net - work. There's uncertainty over which route the UK will take to decar- bonising heat – electrification, hydrogen networks or a hybrid system? Network will explore these options, look at the details and implications of the Climate Change Act, what the networks and their supply chain need to do to respond to the emissions target and will explore the work already being done. Transition to DSO: The shi' to a distribution system opera - tor (DSO) model for distribution network operators (DNOs) has been in the works for a number of years. DNOs have been busy developing, trialling and sometimes even rolling out a ra' of new technologies, systems and markets that will be required for this radical transformation. The transition will see DNOs move to a more active role in the management of their networks with new sources of local flexibil- ity – distributed generation, demand-side response and storage – deployed to deal with congestion and constraints. Network will cover this important subject area as operators contin- ue their efforts to minimise the costs of decarbonisation, in particular by delaying or avoiding the need for expensive network upgrades. DECARBONISATION OF TRANSPORT PAYING FOR THE NETWORKS DECARBONISATION OF HEAT TRANSITION TO DSO Future of flexibility: A number of network operators are now adopting a 'flexibility first' approach to delivering additional network capacity and reducing electricity demand during peak times. Until now providing additional capacity has required new infrastructure, but flexibility services will give operators the opportunity to take a more cost-effective approach. Network will examine how this approach provides a radical rethink to the way networks do business, moving away from automatically building new assets and instead giving the dis- tributed energy resources market the opportunity to offer their services. FUTURE OF FLEXIBILITY Localised energy: When considering a localised energy approach the planning of infrastructure, technologies and the adoption of a whole-system methodology all come into the equation. There is a growing interest in energy from local authorities - cities in par - ticular – and community groups as a driving force for localisation. Localisation will create challenges in terms of knitting together national and local planning but will also create opportunities to better exploit local energy resources and engage with network users. Network will look at examples of localised energy, how it is being adopted and what the future holds. LOCALISED ENERGY

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