Utility Week

UTILITY WEEK | AUGUST 2021 | 9 …and what they mean What this means While supporting net zero was, quite rightly, a central plank of the business plans for transmission companies, it is electricity dis tribution that is likely to feel the brunt of the impact of decarbonisation over the 2020s. The decarbonisation of transport, certainly, and in all probability heat, will put mas sive pressures on the network and demand both investment and new ways of operating. The challenge, of course, is understanding where the balance lies between these two approaches. This is also where there is some divergence in the plans of the DNOs. UK Power Networks chief executive Basil Scarsella sets out on page 19 why he believes networks have to be mindful of over predicting the surges in electricity demand. He points to the fact that only 20 per cent of predicted lowcarbon technology growth has actually occurred in ED1. He also stresses the impact of changing consumer behaviour to peak load. Meanwhile, on page 18 Northern Power grid's Patrick Erwin warns that suppressing bills too much in the short term could create huge intergenerational issues. What to look out for Ofgem will now assess the business plans and give guidance to the companies on sub mitting their final versions in December, at which point all will be required to publish the full documents. It will also give muchneeded clarity on how uncertainty mechanisms will work for ED2. All companies have stressed that they will need to be agile to respond to the changing needs of an increasingly smart and decarbonised energy system. However, it is essential that regulatory red tape does not grind down this ability to respond quickly. DNOs will have reference to the Com petition and Markets Authority's dra' determination in the appeals by gas and transmission before they submit their final plans, as well as the strategic policy state ment the government is preparing for Ofgem. ensure we hold companies to account so that the environment is le' in a better condition for generations to come." What this means While the sector can point to encourag ing signs of improvement in many areas, there seems little doubt that more scrutiny will be applied. Combined sewer overflows (CSOs) are increasingly a subject of public debate. Meanwhile, the Environment Agency is under growing pressure to show that it has teeth and that the Environment Bill will increase reporting requirements. On a more positive note, water companies can point to great strides in transparency. Monitoring of CSOs has increased 14fold over the past four years and the industry is on track for 100 per cent coverage by 2023. What to look out for As Utility Week went to press, the Depart to see more concrete new policy to support what are very ambitious targets. There is also very little in the way of new money com mitted to these projects. The market will do some of the heavy li'ing here as the race to reduce the costs of EVs intensifies but the government must do more to ensure other A national network of public chargepoints will be needed to gain widespread consumer confidence in EVs ment for Environment, Food and Rural Affairs had just published consultations on the water industry strategic environ mental requirement framework along with the water industry national environment programme. These blueprints, along with the revi sions to the strategic policy statement for Ofwat, will establish frameworks for the coming decade. They will undoubt edly include stretching targets and will see policymakers and regulators keen to talk tough on the consequences for future failure. What is lacking from the conversa tion is a willingness to tackle the issue of poor performers dragging down the wider sector. Each company is grappling with specific challenges and while all should be expected to strive for improvement, there is a clear need to acknowledge underlying issues for some companies and how they can be addressed. barriers to adoption are li'ed. Widespread availability of onstreet charging is one of the most crucial. The plan allocates £90 million for councils to help with this but more funds will clearly be needed. The government is also silent on how it intends to fill the gaping void that will inevi What they said Environment minister Rebecca Pow said the report "makes for extremely disappoint ing reading" and noted that even those that scored highly have work to do, especially on the use of storm overflows. "Getting the basics right is critical for water companies and then they need to go further in playing their part in achiev ing a higher level of ambition for our pre cious water environment. On these grounds I will not hesitate to set higher expectations for both water companies and regulators to ensure a level of service that the people of this country and the environment deserve." David Black, interim chief executive of Ofwat, said: "A step change in culture and commitment is required if the sector is to fundamentally change the way it delivers for customers and the environment. Our work with government, the Environment Agency and other stakeholders will continue to tably appear in its balance sheet as the £30 billion it receives every year in fuel duty evaporates. A network of toll roads has been mooted as one option but is not included in the strategy. So, how exactly is the govern ment going to balance the books? What to look out for The government has promised the legis lation on smart charging "by the end of this year". Other offshoots from the plan include a consultation on the introduction of a zero emissions vehicle mandate on automanufacturers. The government will also come under pressure to provide wider strategic thinking on transport, including encouraging walk ing, cycling, escooting and public transport. The upheaval sparked by the Covid pan demic, and the resulting shi' in working pat terns, seems the perfect time to do that.

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