Utility Week

UTILITY Week 27th June 2014

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UTILITY WEEK | 27Th JUnE - 3rd JULY 2014 | 3 Leader Ellen Bennett This week 4 | Seven days 6 | Opinion Alistair Phillips-davies, CEO, SSE Jonathan reynolds MP 7 | Opinion Cathryn ross, CEO, Ofwat 8 | Interview Sarah Venning, CEO, nI Water 13 Policy & Regulation 13 | News Onshore wind ban in Scotland 14 | Analysis Price review set for scrutiny 15 | Analysis Golden rule loses its lustre 18 | Market view The Water Act: fizz or flop? 19 Finance & Investment 19 | News GIB to invest £1bn in offshore wind 20 | Analysis Corporate green bond boom 21 | Analysis UK and China on climate action 22 Operations & Assets 22 | High viz West duddon Sands 24 | Market view The economics of diversity 25 Customers 25 | News The Big deal has best tariff 26 | Event TCS roundtable 27 Markets & Trading 27 | News CCGT renaissance 'will be short-lived', say analysts 28 | Analysis Wholesale link to domestic prices 30 Community 30 | Subscriber focus George Eykyn, British Gas 31 | Disconnector DNOs deserve a fair hearing Brace yourself on Tuesday for the first hearing of the select commit- tee inquiry into network costs. Basil Scarsella, the lone representa- tive from the network side of the debate, is set to share a panel with British Gas – the very company that caused network bosses to turn the air blue with its "back of the fag packet" calculation that Ofgem could slice £500 million off network costs in ED1. Unsurprisingly, networks beg to differ – and no doubt Scarsella will make the case eloquently. But you can't help but feel the game is rigged. Look at the line-up: three suppliers, who have a vested interest in bashing networks on costs, compared with just one distribution network operator. The select committee will argue that other network companies will get their say later in the inquiry – but not before some headline-grabbing political theatre has been played out in their absence. No-one's saying DNOs shouldn't be called to account. Given the current scrutiny on rising energy costs, it is right and proper they should. And the companies don't always help themselves – they have had years to fix competition in connections, and their contin- ued failure to do so speaks of an institutional struggle when it comes to culture change. Communications, as we know, is another area they frequently fall down on. So questions should be asked. But there are two problems with this inquiry. First, there is a widespread lack of understanding of the degree of regulatory scrutiny networks already face. Since privatisa- tion, networks have been heavily incentivised to take cost out of their business through the RPI-X price-setting process. That fact is lost in the heated rhetoric, and misunderstood by those who confuse Ofgem's limited powers and subsequent timidity in the retail market with its much heavier hand on networks. Second, some members of the committee seem to have already made up their mind. Chairman Tim Yeo raised eyebrows at a recent conference with comments that seemed to pre-empt the findings of the inquiry. He told Utility Week as far back as February that he believed network costs needed to come down, and he had already told the prime minister so. Let us hope that when it comes to the hearings, the committee is willing to listen as well as talk. Ellen Bennett, Editor ellen.bennett@fav-house.com GAS 13 | Political Agenda Mathew Beech 27 | News CCGT renaissance 'will be short-lived' WATEr 7 | Chief executive view Cathryn ross, CEO, Ofwat 8 | Interview Sarah Venning, chief executive, nI Water 14 | Analysis Price review set for scrutiny 18 | Market view The Water Act: fizz or flop? 26 | Event TCS roundtable ELECTrICITY 13 | News Onshore wind ban for fifth of Scotland 19 | News GIB to invest £1bn in offshore wind 22 | High viz West duddon Sands 23 | Pipe up Peter Jones EnErGY 6 | Chief executive view Alistair Phillips-davies, CEO, SSE 15 | Analysis Golden rule loses its lustre 20 | Market view Corporate green bond boom 24 | Market view The economics of diversity 25 | News The Big deal offering cheapest two-year fix Knowledge worth keeping Visit the Downloads section of Utility Week's website for special reports and exclusive research commissioned for the utilities industry. http://www.utilityweek.co.uk/downloads

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