Utility Week

UTILITY WEEK | 28TH JUNE - 4TH JULY 2019 | 13 Policy & Regulation practices rather than pursuing a case. Where Ofgem has begun an investigation under competition law, it may accept "commit- ments" to take action as it considers appro- priate for the purposes of addressing the concerns it has identi ed. These commitments, it should be noted, are not admissions of infringement. Where Ofgem has formally accepted com- mitments, it must close the investigation. This was what happened in the case of power exchange company Epex and its parent EEX a• er an investigation into whether the former had "abused a dominant position" by failing to enable rival rm Nord Pool to par- ticipate in certain electricity trading auctions between the British and Irish energy markets. Last month, Ofgem said it was minded to close its investigation because the company had committed to take steps to enable Nord Pool to participate in future auctions and to carry out an internal review of its competi- tion law training. But before it makes that nal decision, the regulator is considering responses to a public consultation on the commitments given by Epex and EEX. It will be interesting to see if any more cases like this develop following the intro- duction in June of tighter rules for market entry. However, it must be noted that con- sidering there are around 70 suppliers in the energy retail sector, only one case warrant- ing a nancial penalty is not a bad record. While it may be worrying that three com- panies were prepared to conspire to the potential detriment of honest consumers, it is also clear that Ofgem's actions in this case serve as a warning to others who attempt to undermine eˆ ective market competition. "Theresa May's successor must follow through on her net zero commitment" I n one of the nal acts of her pre- miership, Theresa May has thrown down the gauntlet in the battle against climate change by con rming a new emissions target for the UK of net zero greenhouse gases by 2050. While the objective will make the UK a leader in tackling climate change among the economies and has cer- tainly laid down a marker for others to follow, the government must now ensure that it makes good on its word by following up with concrete actions. In adopting the 2050 net zero tar- get, the government has followed the recommendations of the Committee on Climate Change (CCC), the inde- pendent committee of experts advis- ing on building a low-carbon economy and tackling climate change. The CCC published its Net Zero report in May on how to end the UK's contribution to climate change and its conclusion was unequivocal, recommending a new emissions target for the UK of net zero greenhouse gases in the next 30 years and an acceleration of govern- ment actions to achieve it. The CCC ascertained that net zero was necessary, feasible and cost- eˆ ective. Given the climate imperative, it is easy to understand why net zero was viewed as a necessity. However, the judgement that net zero by 2050 was feasible and cost-eˆ ective was even more interesting. The CCC argues that the maturation of key, non-carbon emitting technolo- gies – such as clean energy technolo- gies or electric vehicles – mean that these technologies have fallen in cost and become reliable enough for them to become the core of our future infra- structure system. To take an example, in 2008 it was estimated that reducing carbon emis- sions by 80 per cent of 1990 levels by 2050 would cost 1-2 per cent of GDP growth over four decades. The CCC now asserts that for the same cost the UK can become a net zero emitter of greenhouse gases. This reduction in cost is testament to how far the clean energy market has come in the past ten years. Indeed, during this period the price of clean energy has fallen signi cantly and in 2018 the UK's clean energy generation capacity overtook fossil fuel capacity for the rst time. Analysts have noted how the drive towards clean energy in recent years has been greater than the so-called dash for gas of the 1990s. While this has not happened overnight, the decarbonising of the UK energy system has progressed massively. With the clean energy market maturing and its nancial reliability becoming established and institutionalised, an increasing number of funds and lend- ers will invest in clean energy and add to the sector's development. The same is happening with electric vehicles (EVs) and charging infrastructure, now seen as the future of the car industry and attracting sig- ni cant investment from automotive and battery manufacturers, develop- ers and landowners. By putting in place incentives and regulations that provide further market certainty, such as regulations to ensure standardised EV charging across manufacturers, the government can rapidly accelerate the decarbonisation of UK transportation. There is a clear path to achieving net zero greenhouse gas emissions by 2050, but given the scale of the task at hand additional measures are needed to help make this objective a reality. The clean energy sector has demon- strated the way forward, with govern- ment policies ensuring private sector buy-in and investments. Once green, decarbonised industries begin to scale and a tipping point is reached, then clean growth will become self-sustain- ing and government interventions will be less necessary. The prime minister has chosen a bold and ambitious path for the UK. Her successor will need to take up the mantle. Opinion Maria Connolly Partner and head of clean energy at law fi rm TLT Enforcement Decision Panel The Enforcement Decision Panel (EDP) was established in June 2014 to take important decisions in contested and settlement enforcement cases on behalf of Ofgem. It is independent of Ofgem and panel members are selected for each individual case. The panel for this latest case was made up of Elizabeth France CBE, John Swi„ QC, and professor Amelia Fletcher OBE. During 2017/18 the EDP took action against just one company, issuing a settle- ment mandate to E (Gas and Electricity) for its failure to comply with standard licence conditions including the sales and marketing objective and arrangements for site access. The energy supplier agreed to pay £260,000 to Ofgem's voluntary redress fund and the case was closed in January 2018.

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