Utility Week

The Month in Review UTILITY WEEK | MAY 2023 | 7 The Month in Review Underground asset map launches in three regions A pan-utility underground asset map for the entire country took a step closer to becoming a reality in April when it was launched in three areas. More than 70 asset owners in London, the North East and Wales now have access to the first iteration of the National Underground Asset Register (NUAR). This includes energy firms, water companies, tel- ecommunications specialists, transport operators and local authorities. The NUAR has been four years in the making a‚er being established by the Geospatial Commission – part of the Cabi- net Office – in 2019. The idea for the project was first developed at Northumbrian Water's Innova- tion Festival in 2018. The project intends to pro- vide a centralised database for underground asset data in Eng- land, Wales and Northern Ire- land. Scotland currently has a separate platform which covers assets specifically related to the road network. The data-sharing platform aims to benefit the design and planning of infrastructure pro- jects where data must be sourced on buried assets, such as cables, pipes and sewers. Overhaul of CfD auctions tabled The cheapest bids will no longer automatically win Contracts for Difference (CfDs), meaning potentially higher electricity bills for consumers, under government plans to reform its main renewable power support regime. Under the current CfD regime, the 15-year contracts are awarded to the lowest bidder via a process of competitive auctions, progressively reducing for UK consumers the cost of renewable electricity procured via the scheme over recent years. However, the recent worldwide surge in inflation has sparked concern that this reduction in renewable deployment costs must go into reverse in order to attract bidders for future auctions. A Department for Energy Security and Net Zero (DEZNZ) paper on the subject points to a swathe of challenges including renewable energy supply chains struggling to cope with upward pressure on costs; increased supply chain disruption; surging global demand for renewable energy and limited manufacturing capacity for key components. Under the government's proposals, applicants for CfDs would have to balance costs with non-price factors, such as sustainability, addressing skills gaps and enabling system flexibility and operability. An example is that investment in infrastructure that builds up the industry's wider capacity, such as ports and the grid, could be among the non-price factors rewarded. However, introducing these additional factors into the CfD process could increase deployment costs with knock-on consequences for consumer bills, while adding to the complexity of auctions, the paper acknowledges. The paper outlines several options for introducing non-price factors. They include a "top-up" to the CfD strike price, based on non-price factors, which would be added over the contract's initial years once the auctions have been run. This model is the least complex of the options to implement and would involve the fewest changes to the CfD process but would reduce the government's ability to control the impact on electricity bills. Under another model, which is similar to that used by many countries in the EU, non-price factors could influence how CfD bids are ranked. The government is also exploring whether to scrap the existing rule exempting sub-300MW projects from supply chain requirements. Bill payers could be on the hook for water sector reforms Concerns about how water sec- tor reforms outlined by the gov- ernment will be funded have been raised by consumer group CCW. Following publication of the government's Plan for Water, the head of CCW told Utility Week that there was no evidence that the cost of improvements has been considered or, crucially, who will pay for them. Emma Clancy, chief execu- tive of the water watchdog, told Utility Week there was a lot to welcome in the plan in terms of accelerating water resource pro- grammes and a focus on forever chemicals. However, she said a lack of detail on costing was a glaring omission and could lead to bill increases for customers. "There needs to be so much more discussion about who's going to pay," Clancy said. "That is just absent, which obviously could jeopardise the implemen- tation of the plan if it's not con- sidered appropriately." The Plan for Water collates government's ambitions to improve river water quality by addressing pollution at source from wastewater, agriculture, highways and other sectors. It adds regulatory tools and extends enforcement powers against polluters. It ties together the government's plan to mini- mise the harm caused by com- bined sewer overflows, which carry a cost of £56 billion for the industry through work staggered over 25 years. See comment, p13 £41bn The potential hit to the economy of failing to invest in river health, according to the Environment Agency. £1.6bn Value of projects water companies in England want to accelerate to address harm from storm overflows, improve water quality and enhance resilience.

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