Utility Week

10 | 26TH APRIL - 2ND MAY 2019 | UTILITY WEEK Policy & Regulation This week Adonis: NPS 'ducks' answers on water Ex-chair of the NIC dismisses national policy statement as a 'list of considerations', not a plan Lord Adonis, former chair of the National Infrastructure Commis- sion (NIC), says the government has "ducked" critical water infrastructure issues. Speaking earlier this month in a House of Lords debate on the dra national policy state- ment (NPS) on water, published towards the end of last year, he dismissed the document as a "list of considerations". He said: "My concern is that the dra national policy statement we are debating is essentially a list of consid- erations that need to be addressed in the development of a national strategy for dealing with water infrastructure. It does not set out a strategy." Lord Adonis said the "issues at stake" including the prospect of new infrastructure such as reservoirs, water metering policy and the consideration of a national water grid are all "very controversial". While he said he was glad the NPS pays tribute to the work of the NIC, which has "wrestled long and hard" with such issues, he stressed that the policy statement does not appear to "take the debate forward". "The questions of whether we will or will not be building new reservoirs, will or will not have a national water grid or will or will not have mandatory water metering – three absolutely critical issues in terms of a water infrastructure plan – the government has ducked them all," the Labour peer said. Lord Gardiner of Kimble, responding on behalf of the government, said it planned soon to set ambitious targets for reducing consumption, and he pointed out that environment secretary Michael Gove had made clear that a "step change" was needed in reducing leak- age. KP ELECTRICITY EA lists 'concerns' for Sizewell consultation The Environment Agency has released a response to the stage three consultation of EDF's pro- posed Sizewell C nuclear power station. The planned development would be adjacent to the Sizewell A, currently being decommissioned, and Sizewell B nuclear stations. Objections have been raised about the proposal, with a group of celebrities led by Bill Nighy penning a joint letter to the Daily Telegraph in March raising con- cerns about potential environ- mental impacts. A public consultation ran from January this year to March, at the end of which it was antici- pated EDF would begin relevant applications for the project, such as a development consent order (DCO) and environmental permits. The Environment Agency, however, has published a list of concerns with the consulta- tion documents that must be resolved before a DCO applica- tion can be submitted. It said that while EDF had identified many of the areas it needed to take into account, the assessments that underpin these areas had not been provided. Specifically, it said plans for Sizewell C lack: a finalised flood risk assessment; propos- als for groundwater mitigation measures, together with a monitoring and maintenance strategy; a coastal manage- ment and monitoring strategy, together with contingency, to mitigate impacts; a full assess- ment of impacts to marine and terrestrial wildlife and proposed mitigations; detailed drainage strategies; and modelling under- pinning the assessments and matters listed. ELECTRICITY Ofgem consults on capacity market Ofgem has launched a consulta- tion on the rules of the capacity market framework. The consultation, which runs until 28 May, will look at changes proposed by the regulator to simplify the capacity market in the short term. The proposals include amendments to reduce the complexity and burden of pre- qualification, including enabling providers to delay submission of certain data items to the agree- ment management process. They also include amend- ments to facilitate a more open and liquid secondary trading market, including by opening the secondary trading market from the T-4 auction and by reducing barriers to participa- tion in secondary trading. According to the consultation document, this is the first phase in developing a "longer-term programme" of changes to the capacity market rules and to the way Ofgem's rules change process operates. No verdict on new reservoirs Tougher entry tests for energy suppliers entering the market will be rolled out from June to drive up standards for customers and reduce the risk of supplier failure. Those wanting to enter the market will be subject to more "stringent" tests. They will have to demonstrate to Ofgem they have "sufficient funding" and provide a customer service plan. ENERGY Failures prompt tougher entry tests for would-be energy suppliers The regulator will also launch in the summer a consultation on "ongoing requirements" for sup- pliers currently in the market. Brilliant Energy on 11 March became the third supplier to cease trading this year, just days a er it was revealed to be in credit default. It followed Economy Energy, which was also in credit default prior to market exit, and Our Power. The three companies added to a list of supplier fail- ures in 2018. Ofgem's announcement was welcomed by Citizens Advice, which described the intervention as "good news for consumers". Under the regulator's new rules, applicants will be required to show they can "adequately fund" their operations for their first year, outline how they expect to comply with key regu- latory and market obligations, and show their intentions to pro- vide a proper level of customer service. Mary Starks, executive direc- tor of consumers and markets at Ofgem, said: "In an ever-evolving market, Ofgem's objective is to protect consumers while also ensuring they enjoy the benefits of increased competition."

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