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16 | DECEMBER 2020 | UTILITY WEEK Build Back Better Town-scale trials needed to end 'total paralysis' on heating Town-scale trials are needed to end the energy industry's "total paralysis" on the decarbonisation of heating, the founder of Greencoat Capital told the forum. While conceding that the costs may run into the "hundreds of millions of pounds", managing director Richard Nourse said the bill would be "pretty skinny" when com- pared with the amounts that must ultimately be spent to address the issue. "Half the world thinks it's going to be electric and half the world thinks it's going to be hydrogen," Nourse explained during a panel session. "I actually doubt it's going to be hydrogen heating. I'm quite strongly thinking it's going to be electric, mostly. But what I'm really keen to do is be informed about this and actually start to have some experiments – town-scale experiments." He continued: "At the moment, we're in total paralysis and I can't see much evidence that we're going to be any more knowledge- able about what the drawbacks are; what the good things are; what are the things that we didn't know that we didn't know and all the rest of it; unless we actually start to do it. "Pick a few towns, do a few things and let's get going with a multitude of different solutions … We have to make that leap now. The time we have available is not enough otherwise. We need to get started." Nourse said ministers and regulators also need to "start to let the money flow" for the electrification of transport: "It seems obvious that the electrification of vehicles is what's going to happen. I think it's a no regret deci- sion to start to make that happen." His comments echoed those of Northern Powergrid chief executive Phil Jones who had earlier disputed the description of net- work reinforcements to accommodate elec- tric vehicles as "anticipatory" investment. "I would say now reinforcing for electric vehicles is not anticipation ahead of need." Jones said it's "hard to imagine" that these investments would be wasted: "I don't think that's anticipatory at all. I think it's just in good time and good order." Lewis bemoans 'hurdles' to green heat projects Six in seven households dropped out of an Eon UK pilot programme to install heat pumps because the grants offered did not cover the cost of remediation work, the company's chief executive told the forum. During the session on energy efficiency, Michael Lewis said Eon had been carrying out a pilot programme with Newcastle council to install 250 heat pumps. While there had been "a lot of enquiries" about the programme, he said 85 per cent of those who expressed an interest had "pulled back" because the cost of remediation works, such as replacing carpets, was not covered by the grants for installing the heat pumps. "While the relative value of that is small, it is critically important. We need to design schemes so they are attractive to people and there are not hurdles in the way to put them off. "This is about making schemes really attractive to customers. It has to be simple, attractive and customers need to know that work will be done to the highest standard." "Home-owners are nervous about tampering with their homes." Lewis also urged a "tidying up" of the various existing energy efficiency schemes, such as the industry-funded Energy Company Obligation. And he expanded his call for an extension of the £200 million first phase of the Local Authority Delivery energy efficiency scheme, which is part of the wider £2 billion Green Homes Grant voucher initiative. "We can deliver in the short term with tweaks to the existing time but can only deliver long term if we can train the next wave of workers needed." "It's a great step forward but only a first step. "We need to see a long-term programme that will bring more investment into energy efficiency. "We are hopelessly behind the curve on delivering energy efficiency: it's not even low hanging fruit but fruit lying on the floor." Ofgem must evolve to adapt to changing sector Ofgem must undergo organisational changes to adapt to the ever-evolving energy land- scape, the regulator's chief executive, Jona- than Brearley, told the forum. In his presentation, he identified some focus areas for the regulator under his stewardship. He spoke about the importance of invest- ing in low-carbon infrastructure, the need for a flexible marketplace, the future of the retail market and data and digitalisation. The Ofgem chief also talked about system governance, the way the regulator manages the system and institutions behind it. He said: "As you know, we do have the system operator review ongoing, we do expect to be publishing that in due course. "But that is only part of the story. We do accept that we as a regulator may need to change. We are absolutely up for having a conversation about what a 21st century regu- lator in the energy sector looks like." Since taking the helm earlier this year, Brearley has commenced an organisational restructure of Ofgem's leadership team. Analysis continued from previous page of economic and environmental results, from renewable generation, to energy effi- ciency and natural capital infrastructure solutions. The well-worn calls for an Energy White Paper to provide some clarity over net zero transition pathways were issued once again and this time energy minister Kwasi Kwarteng assured the paper would be pub- lished "within weeks". If his promise holds true, readers should be able to digest its content by the time this magazine is in your hands.