Utility Week

16 | 12TH - 18TH JULY 2019 | UTILITY WEEK Finance & Investment This week National Grid plans to allot £10.4bn to RIIO2 Proposed spend includes maintenance of existing networks, grid reinforcement and cybersecurity National Grid has unveiled preliminary proposals to spend £10.4 billion over the RIIO2 price control period – £7.4 billion on electricity transmission and £3 billion on gas transmission. The firm has submitted its dra business plans to Ofgem's RIIO2 Challenge Group for con- sideration by industry experts. National Grid has earmarked almost £4.6 billion to maintain and upgrade the electricity transmission network, and proposed spending another £752 million to reinforce the power grid to deliver 20.3GW of extra capac- ity and £479 million to connect 17.3GW of assets to the network, including 12.6GW of low-carbon generation. It also expects to invest £620 million to protect the power grid from external threats such as cyberattacks and extreme weather, £226 million to reduce its environ- mental impact and £121 million to drive innovation. On gas transmission, National Grid proposes to spend £890 million to maintain the existing network, £615 million to protect it from external threats and £255 million to ensure its compressors comply with EU emissions limits. TG • Network operator SP Energy Networks plans to spend £1.425 billion on its transmission network for RIIO2. It will spend £607 million maintaining and upgrading its existing assets and £593 million increasing network capacity. And the electricity system operator (ESO) at National Grid has published its dra business plan for RIIO2. It will spend £270 million a year over the first two years of the settlement period – a £90 million increase. ELECTRICITY Hybrid EV sales slump for first time Figures that show the first drop in sales of low-emission vehicles for more than two years have prompted new calls for invest- ment in charging infrastructure. Figures from the Society of Motor Manufacturers and Trad- ers show that overall sales of what it calls "alternative-fuelled vehicles" (AFVs) fell 11.8 per cent to 13,314 units in June. This marks the first decline in sales of AFVs, which covers all plug-in hybrid and battery- powered electric vehicles (EVs), since April 2017. The figures came as Jaguar Land Rover announced it will invest hundreds of millions of pounds in EV manufacturing at its Castle Bromwich plant in Birmingham. The drop in sales of AFVs follows withdrawal last Novem- ber of government grants for purchases of hybrid vehicles and cuts in those available for electric cars. ENERGY 'Put City at heart of net-zero push' A ra of measures has been unveiled to boost green invest- ment in the UK, including £5.8 billion of climate finance. Launching the new Green Finance Strategy, City minister, John Glen, said the financial ser- vices sector must be at the heart of efforts to reduce emissions to net zero by 2050. The strategy sets out plans to increase investment in sustain- able projects and infrastructure, while setting expectations for publicly listed companies and large asset owners to disclose by 2022 how climate change risk impacts their activities. Glen said this could lead to manda- tory disclosures. The plan also includes a Green Home Finance Fund to help pilot products like green mortgages, which use green finance for home energy effi- ciency, and incentivise energy efficiency retrofit projects. ENERGY Rebrand for Octopus Energy Investments Octopus Energy Investments, the energy investment arm of Octo- pus Group, has been rebranded Octopus Renewables. Since entering the market in 2010, the company has built up a 2.3GW portfolio of onshore wind and solar assets worth more than £3 billion. Matt Setchell, co-head of Octopus Renewables said: "We look forward to building on the huge success of the UK's energy market, exporting our expertise to new markets and breaking down the barriers for the crucial investment in the sector." £890m earmarked for gas network maintenance Ofwat is expected to launch a consultation next week on how it can support innova- tion in the water sector. The regulator confirmed to Utility Week that the industry will be asked its opinion on the subject but refused to comment on the parameters. However, a former director of Ofwat has set out his vision for a £35 million-a-year ring-fenced innovation fund and the crea- tion of a dedicated centre of excellence. Trevor Bishop, who was director of planning and strategy at Ofwat and before that deputy director of the Environment Agency, said technology, leakage and climate change resilience were key areas in which the industry rapidly needed to develop new ideas. Bishop, who is now a director of Water Resources in the South East (WRSE), stressed that while there had been some great initiatives across the sector, they had tended to be "small-scale, localised and risk averse with not as much co-ordination as we would like". WRSE worked with 20 organisations to develop a submission to Ofwat's emerging strategy entitled "innovation – delivering for customers, society and the environ- ment". The proposal is based on a modification of Ofgem's Networks Innovation Fund, and Bishop said that if taken up it would be "the biggest boost to innovation we have ever seen in water". The model put forward by WRSE would be for about £35 million – roughly compa- rable with Ofgem's Networks Innovation model. WATER Ofwat to consult on an innovation fund for the water sector

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