Utility Week

UTILITY WEEK | 29TH NOVEMBER - 5TH DECEMBER 2019 | 21 Finance & Investment The world's largest oil firms are investing very little in clean energy despite commitments to move away from fossil fuels, according to Aurora Energy Research, which analysed capital expenditure by oil majors between 2010 and the third quarter of 2018. Outlining the findings, Aurora managing director John Feddersen said their investment is still "domi- ENERGY Oil majors' investment in fossil fuel alternatives remains low nated" by spending on fossil fuel exploration and production. French energy giant Total leads, with 4.3 per cent of capital expenditure on low-carbon tech- nologies, although as Feddersen noted, carbon capture and stor- age accounts for "a big part". BP came second, with 2.3 per cent of its investment allocated to clean energy. It acquired a minority stake in solar developer Lightsource in 2017 and last year bought electric vehicle charging company Chargemaster outright. Anglo-Dutch company Shell invested just 1.3 per cent, placing it fourth. The director of its new energies division, Maarten Wet- selaar, said earlier this year that the firm is planning to become the world's largest power com- pany by 2030. To achieve this, it plans to increase spending on Renationalisation not a concern at UU United Utilities' chief executive says privatisation has delivered huge improvements for customers Privatisation's track record means nationalisation is of lit- tle concern to United Utilities, according to chief executive Steve Mogford. On the back of the company's strong performance for the six months to 30 September, Mogford told Utility Week the best thing the sector can do is to continue delivering high levels of performance. "Privatisation has delivered huge improvements for customers without any pressures on the public purse. It hasn't caused people to reflect on whether they compro- mise on schools or hospitals or police. The track record is there for everyone to see. Our job is to keep delivering those services. "We have made a major transformation in five years, going from one of the worst companies to one of the best, and we know there is so much more we can do. We have to keep our heads down and keep working hard on delivering for customers and shareholders." The company reported a "strong set of financial results" with revenue up £19 million to £936 million for the six months to 30 September 2019. Reported operating profit increased by £44 million to £383 million, reflecting the increase in underlying operating profit and a decrease in adjusted items. As one of three fast-tracked companies for PR19, United Utilities had "a huge amount of certainty at the beginning" of the process that has allowed it to get on and prepare for AMP7 from the beginning of this year. The group will pay an interim dividend of 14.20p per ordinary share, up from 13.76p year-on-year, to be paid on 1 February 2020. This 3.2 per cent increase was in line with AMP6 growth policy. RW ELECTRICITY NPG plans to hold flexibility auction Northern Powergrid is to hold an online auction for flexibility services to help manage its network in the event of a fault. The distribution network opera- tor (DNO) aims to contract up to 100MW of flexible capacity across seven locations though its Restore Flexibility scheme. The auction will be open to demand-side response provid- ers, generators, aggregators and storage operators. It will take a 'reverse Dutch' format, whereby the auctioneer incrementally raises the price from a low start- ing point until a bidder agrees to sell. Andrew McKenna, North- ern Powergrid's commercial development manager, said: "On the occasion where utilising customer flexibility is inherently cheaper than the counterfactual action, we will look to take this action, meaning that not only do customers with assets ben- efit from a new revenue stream, but every single customer ben- efits financially from the DNO achieving the same outcome through a more cost-effective method." Northern Powergrid's head of policy development, Jim Cardwell, added: "With increas- ing numbers of councils across our patch declaring a climate emergency, we are eager to build a system that can support a fully decarbonised power sector, while ensuring we provide the best possible service at the best possible price for every single member of our community. "Actions like flexibility pro- curement for network resilience are crucial to this and empower our customers to play a more active role in network manage- ment." ENERGY Renewable investors regain interest in UK Renewable investment is "pick- ing up pace" despite uncertainty over the terms of Britain's depar- ture from the EU, according to the latest edition of EY's bian- nual Renewable Energy Country Attractiveness Index. The UK swapped places with Japan to retake seventh position in the index, which ranks 40 countries on their attractiveness to investors in the sector. The index was once again topped by China in first place and the US in second, despite the former experiencing a crash in investment. India moved up one place to complete the top three, replacing France, which dropped to fourth. The UK scored highly on offshore wind and marine power, coming second in these categories to the US and France respectively, but scored poorly on solar, ranking 36th out of 40. EY noted the results of the latest contracts for difference auction in which agreements were awarded for almost 5.8GW of capacity at less than forecast wholesale prices. Mogford: "Track record is there to see" the division to between $1 billion and $2 billion a year by 2020. Feddersen said it is possible to "infer what the big oil and gas companies are thinking about the future by their investment paths". He said the figures sug- gest the oil firms are not expect- ing global emissions to fall to net zero by 2075, as will likely be needed to limit global warming to 2°C above pre-industrial levels. This week

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