Utility Week

UTILITY WEEK | DECEMBER 2021 | 7 The Month in Review SSE to sell 25% stakes in network businesses SSE has announced its inten- tion to sell 25% stakes in its electricity transmission and distribution networks to help fund a new commitment to invest £12.5 billion in low-car- bon infrastructure by 2026. It said the figure repre- sented an increase of £1 bil- lion a year – or 65% – over its previously announced plans. SSE said the investment programme would allow it to deliver over a quarter of the UK's target to install 40GW of offshore wind by 2030. By 2026, the company said it would have doubled its net installed renewable gen- eration capacity to 8GW and built up a sustainable devel- opment pipeline of 15GW. Chief executive Alistair Philips-Davies said: "A–er all the commitments made at COP26, now is the time to deliver. Our Net Zero Accel- eration Programme rep- resents the next phase of SSE's growth and involves a substantial ramping up of investment – equivalent to nearly £7 million each day in low-carbon infrastructure – backed up by clear delivery and funding plans. DNOs need to 'dramatically' raise flexibility ambitions, says Octopus Electricity distribution networks need to "dramati- cally" raise their flexibility ambitions and "move further, faster" during the RIIO-ED2 price controls, Octopus Energy has argued. The company made the comments in response to the dra• business plans of the distribution network operators (DNOs), which will submit their final plans to Ofgem on 1 December. Octopus said that although most DNOs have run flexibility tenders and there are frequent references to a "flexibility first" approach in their dra• business plans, there are "significant gaps in the substance". It said the ED2 price controls, covering a five-year period beginning April 2023, mark an "inflection point" in the transition to net-zero emissions, herald- ing "an increased penetration of variable, distributed generation, an uptick in electric vehicle ownership, and the roll out of millions of heat pumps. "Distribution network operators must decide whether to build systems and capabilities for the future network, utilising the potential of low-carbon flexibility fully in their portfolios, or to rely on out- dated methods of grid reinforcement that would slow down the integration of low-carbon technologies and lock in unnecessary costs for customers for years into the future." To ensure meaningful progress, the price controls should contain "ambitious, quantifiable targets" for flexibility: "Without concrete targets in the price control settlement it will not be possible for Ofgem to hold the companies to account for making good use of flexibility and market confidence will be lost." Octopus said only three of the six DNOs in Great Britain have included quantifiable targets for flexibil- ity in their dra• business plans, and only two – Scot- tish and Southern Electricity Networks and Northern Powergrid – gave financial targets for spending on flexibility services. It also called for stronger mechanisms to hold DNOs to account, warning that uncertainty mecha- nisms could "so•en the commitment to flexibility" if they are "too broad or loosely designed". It said uncertainty mechanisms should not offer DNOs "an easy way out" and allow them to "revert to traditional methods except where those are more expensive". See the full article at https://utilityweek. co.uk/dnos-need-to-dramatically-raise-flexibility- ambitions/ £258m The amount of funding Avro Energy would have needed to secure to survive the winter, according to the adminstrator's report on the failed supplier. 47% Of young energy professionals have confidence in the government's plans to reach net zero by 2050, according to a poll by Energy UK. Ofwat has launched an inves- tigation into allegations of ille- gal discharges from Combined Sewer Overflows (CSOs) a–er receiving reports of "widespread unpermitted releases of sewage". The regulator said new infor- mation, along with analysis by the Environment Agency, sug- gested water and wastewater companies "may have released sewage into rivers and water- ways when they were not legally allowed to do so". It warned that findings of non-compliance with environ- mental permits would lead to prosecution. Ofwat's interim chief execu- tive, David Black, wrote to com- panies requesting full disclosure on any illicit uses of overflows, why they occurred and what level of involvement the com- pany's board has in monitoring and scrutinising their use. Black requested company boards explain how environmen- tal performance and compliance was considered in decisions on dividends and executive bonuses. The letter follows an earlier correspondence from Black in the summer putting pressure on companies to improve their mon- itoring of CSOs and take action to minimise their environmental impacts. "I haven't seen enough to suggest that message was heard or heeded, and this new infor- mation suggests there may have been very serious failings by water companies in treating wastewater," Black said. "We will find out what company boards knew and when, and if there has been management fail- ure or misreporting of data to us and to the public. If we find there has been, we will use all of our powers to hold companies to account." Ofwat said the extent of non- compliance suggested by the Environment Agency's analysis would be "wholly unacceptable" and may indicate a failure of the processes that should be in place to manage CSO use. The letter from Black requested details of the extent of any non-compliance, includ- ing how many sites were affected and estimates of the number of unpermitted CSO spills and how long they lasted. Companies were asked for explanations of the cause of non-compliance and details of their strategy for moni- toring and maintaining related assets and systems. It said com- panies must set out plans and timescales to fix any problems that are uncovered. See Environment Act analysis, p26 Ofwat to probe 'unpermitted' sewage discharges Companies will be 'held to account'

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