Utility Week

UTILITY WEEK | 13TH - 19TH DECEMBER 2019 | 15 Policy & Regulation This week Regulator minded to let Shell recoup costs Energy retailer's £354,000 claim is for the cost of refunding credit balances owed to Usio customers Ofgem has announced it is minded to allow Shell Energy to claim a £354,000 last resort supply payment (LRSP) claim for costs incurred when, under the banner of First Utility, it took on the customers of Usio. The company took on around 7,000 Usio customers through the supplier of last resort (SoLR) process in October 2018. The energy retailer's £354,000 claim, made on 30 August this year, is for the cost of refunding credit balances owed to customers when Usio ceased trading. It is not claiming for the cost of "closed" credit bal- ances owed to former customers who had switched to another supplier at the point the company exited the market. Shell also indicated to the regulator that it had incurred a number of other costs in relation to its role as the SoLR, which it is not claiming for. These costs, which are not final, relate to third-party contracts, customer calls and contact handling. Ofgem's minded-to decision is now up for consulta- tion among industry stakeholders and a decision on the matter is expected by January. This will allow the approved claims to be recovered from relevant gas and electricity distribution network companies in 2020/21. In September, Ofgem agreed to allow Together Energy to claim up to £4.5 million to settle the costs it incurred during the SoLR process in December last year. AJ ELECTRICITY Ofgem consulting on network forecasts Ofgem is consulting on changes to both the content and format of the long-term development statements that electricity net- work operators are required to publish each year. The regulator said improve- ments in the quality and availa- bility of forecasting and planning data will be vital to the execution of a number of distribution sys- tem operator (DSO) functions. The statements are intended to provide developers with the necessary information to assess the viability of their projects. They contain detailed technical information on the present state of the networks and how they are expected to evolve over the following five years. Ofgem said there is a "grow- ing need" for visibility over energy assets connected to distributed networks: "This is important for understanding the contribution of distributed generation to the security of sup- ply of the GB system; informing co-ordinated actions by network and system operations across transmission and distribution planning; informing investment decisions; and facilitating effi- cient flexibility markets." The scope of the statements is currently limited to 33kV networks, but Ofgem said it is considering extending it to cover 11kV networks as well. It previ- ously decided against this due to "the scale and complexity of the 11kV networks and the cost of collating and sharing the data". But the regulator said the work of the government's Energy Data Taskforce assumes 11kV data will eventually be made available. It is also considering stand- ardising a model for the sharing of data, which at the moment is presented in Excel spreadsheets. The deadline for submissions is 7 February 2020. ENVIRONMENT CCC issues call for evidence on budget The Committee on Climate Change (CCC) has issued a call for evidence to inform its advice to government on the sixth car- bon budget covering the years 2033 to 2037. The budget will be the first since the government committed to reduce greenhouse gas emis- sions to net zero by 2050. It is due to be set in September 2020. The climate watchdog said the consultation is longer than previous iterations due to the inclusion of sector-specific ques- tions and enquiries concerning the Welsh government's third carbon budget, on which it is also seeking evidence. The deadline for responses is 5 February 2020. Crowd funded: company honoured credit balances ELECTRICITY Floating wind on high seas 'will require a global legal framework' The deployment of floating wind turbines on the high seas will require international laws for ownership, which could take decades to establish, according to a new report from Chatham Partners. More than two-thirds of the world's oceans are outside the control of a single nation. The law firm, which specialises in renewable energy, says unless work to create a new legal framework begins now, the industry risks being locked out of these waters for many years. The report notes there are precedents for international agreements to facilitate access to resources outside territorial waters. For example, the Interna- tional Seabed Authority (ISA) was created to permit public and private organisations to extract minerals from the seabed beyond their states' jurisdic- tion. A treaty has also been proposed to govern biodiversity outside national borders, which Chatham says could provide a model for offshore wind. But the report warns that the negotiations to establish the ISA took more than 20 years to complete. It says the biodiversity treaty has been debated since 2004 and will likely remain a dra¦ for several more years. Felix Fischer, a partner at Chatham Partners, said: "The high seas could have the poten- tial to further unlock the expan- sion of offshore wind beyond what can be developed along coastlines if the industry deems it feasible from an economic and technical perspective. "However, the technology to allow development in these areas could outpace the legis- lation. Without a legal frame- work, these sites will remain out of reach for developers for decades to come." All of the North Sea falls within the territorial waters of neighbouring countries, with the UK controlling the largest area.

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