Utility Week

UTILITY WEEK | 15TH - 21ST MARCH 2019 | 15 this campaign is looking at these areas – it's something the Commission for Customers in Vulnerable Circumstances, and our own Future of Energy project, have been looking at too. They are both due to report shortly." Abbie Sampson, director of external a airs, Energy UK "The New Deal for Utilities has demonstrated that energy and water must address the legiti- macy gap as a matter of urgency. Regaining the trust of customers is critical. "Technology and how consumers use tech- nology is changing at a rapid pace. Govern- ment, regulators and companies need to be thinking about how to make existing consumer protections fi t for the future. "Good consumer outcomes will be central to this. Regulators and fi rms must now demonstrate that consumers are at the heart of everything they do. This means people being able to access genuinely independent advice and support when things go wrong. "Value for money is also key – essential services must be accessible at a fair price. "Ofgem has a chance to put a marker down. By limiting the excessive profi ts of net- works it can deliver a fair deal for households." Gillian Cooper, head of energy policy, Citizens Advice Setting sail for a 'New Deal' for utilities I n 1938 Roosevelt said "To reach a port we must set sail. Sail, not tie at anchor. Sail, not dri ." In many ways, utilities are in the front line of some of the transformational forces reshaping our lives. As key parts of the "foundational" economy, how they navigate technological, societal and environmental/ climate disruption matters. Addressing only one of these challenges will not prepare them for the future. Staying put or dri ing is not an option. But, in the face of signi- cant uncertainty, deciding which "port" to sail to and which course to chart requires bravery and "li ing of the sights" to get a better picture of inter- dependencies, priorities and the sequence/ pace of change needed. Roosevelt's 1930s New Deal revolved around a series of programmes with fairness at their heart, so for utilities today a package of change is needed, but one focused on fair- ness – within and between generations. There are many proposals for radical regulatory redesign. However, it may be pre- mature to introduce these now. Implement- ing a series of "low" regrets evolutionary changes (such as a collaboration duty and strategic cross-regulator arrangements) is a necessary - rst step – but on its own will not be suŒ cient. Companies are already exploring how they can develop "sustainable licences to operate" to proactively address disruption and demonstrate their trustworthiness. Sus- tainability First's Fair for the Future Project "Sustainable Licence to Operate" strawman proposes this is built on: public purpose and values; making the best use of capital through competition and collaboration; step changes in engagement to realign roles and responsibilities around fairness; and com- pany and sector strategy and narratives. We are currently testing our proposals with stakeholders. This iterative process should highlight where more radical rede- sign is needed. Opinion Sharon Darcy Director, Sustainability First you've looked to really push the boundaries on what I would call business as usual. You have got lots of people to articulate. Now it is about getting them to do something more." Our next stage discussions are something Sandys says she would be delighted to take part in, to help support the sector to lead the charge for the future. "I would say the sector is now catching up with the public mood. But it needs to go further – to start setting the agenda, rather than have sometimes the agenda imposed upon it." Also welcoming the campaign - ndings this week, former regulator Maxine Frerk, director of Grid Edge Policy, said it was now very important the industry knew the prob- lem it was really trying to solve, rather than sim- ply reacting by changing struc- tures. For example, she would not necessar- ily be in favour of a large multi-regulator as has been mooted by some. "Lots of other questions need to be asked - rst about where regulation is going. We do need more working across utilities but there's lots of ways we could achieve that, through more incremental change. And there are lots of questions around the role of the regulator versus government, which is not very clear. We also need to ask how you get more of a consumer voice into some of the big policy debates. "I think a discussion group could cer- tainly look at this and take these things for- ward. I think the campaign has been a useful exercise. It's been an important debate which I'd like to see continued." Water UK chief executive Michael Rob- erts said Utility Week's campaign has been "a valuable addition to the debate about GET IN TOUCH the future of our sector". "It comes at a time when the water industry is actively consid- ering how best we express our special posi- tion as responsible businesses delivering an essential public good. And while [phase one] the New Deal for Utilities campaign may be wrapping up, the issues raised will con- tinue to be an important part of the ongoing debate." David Smith, chief executive of the Energy Networks Association, said our campaign had "got to the heart of an important set of questions the utilities sector is facing". "As our energy market continues to change and the public come into more direct contact with that change, then that will only increase the need to answer those questions. "We should never lose sight of the fact that we are private companies deliver- ing a vital public service. That philosophy runs through the veins of those people responsible for keeping our lights on, our homes warm and our busi- nesses running. It's made Britain's energy networks the success story they are. It's important we - nd the right message to get that across to the country.' Sustainability First's Sharon Darcy (see column, right) has been doing a lot of work over the past three years in this space, including taking a broader look at "the future of the corporation" "Some really important things appear to have been drawn out in the New Deal campaign. "Our concern in all of this is that all the talk around social contracting remains just talk. Potentially that is quite risky because you're raising people's expectations if you don't then follow through in terms of how that's embedded in company behaviour." This is an excerpt of a full column written by Sharon Darcy for Utility Week, which can be found online at: www.utilityweek.co.uk • You can view our campaign online at www.utilityweek.co.uk, on Twitter @Utility Week; and LinkedIn #NewDealForUtilities. • To share your thoughts or for more details contact: suzanneheneghan@fav-house.com "It's been a very forward-looking campaign. And quite a brave thing – you've looked to really push the boundaries on business as usual." LAURA SANDYS, CHALLENGING IDEAS

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