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UtILItY WeeK | 3rd - 9th OctOber 2014 | 17 Policy & Regulation comed, opens up potential for further inves- tor participation – to the extent permitted by the pre-existing national licensing regime. This is a strong signal of the govern- ment's commitment to encouraging invest- ment in UK energy markets. It was perhaps no coincidence that the government's early plans for this were announced in the same month as its report on delivering UK energy investment. However, the reform does not present an "open door" to investor participation. The proposed changes do not create an auto- matic exemption. Rather, emphasis is on the applicant's ability to demonstrate a convinc- ing lack of discrimination. Ofgem can be expected to scrutinise the facts of each case closely and its decision must then be approved by the Commission. Ofgem guidance on this issue is expected and it should also be noted that the govern- ment proposes not to allow the discretionary power to be exercised in relation to an elec- tricity transmission operator that is directly physically connected to a generator. In such cases, the risk of discrimination is presumed (see figure 2 for scenarios where Ofgem will have no discretion). Responses to these proposals for new unbundling rules are invited by 14 October 2014, with the intention being for the new regulations to come into force in early 2015. Northern Ireland's regime is unaffected by the proposals. Mark Jones, partner, and Alex Olive, sen- ior associate, Hogan Lovells FiGURE 2: scEnaRios whERE oFGEm will havE no discREtion Holdco having control or a holding in: Electricity transmission system operator (including Oo) Producer or supplier operating a generation station which is directly physically connected to part of the transmission system operator transmission system or electricity interconnector Market view Points for good behaviour Behavioural science can offer insights into encouraging energy efficiency, says Claire Jakobbson. L ast week, shadow energy minister Caroline Flint told the Labour conference that the party's plans would make 5 million homes more energy efficient within ten years, without additional government spend- ing or adding to consumer energy bills. Labour has also committed to the delivery of half a million free home energy reports, in order to help families know how and where they can cut their energy bills. What's interesting here is the political acknowledge- ment that infrastructure alone (ie the UK's smart meter rollout mandated for 2015), is neither the panacea when it comes to reducing pressure on the UK's energy sector, nor in fact a resolution for rising household bills. While the relative value of the UK's smart meter roll- out has been much debated, there is no debating the fact that it remains a key step in the UK's journey towards a smart grid, which in turn should enable better energy management at a household level. But it is only the first step. Tapping into how consumer behaviour impacts energy use is vital in Britain's move towards a low- carbon economy. However, behavioural energy-saving programmes are not just about pure energy efficiency savings. They are also about giving back some level of control to consumers, restoring their faith in our energy companies and empow- ering individuals to take control of their energy use. Opower has worked closely with utility companies around the world to support smart meter rollouts and our experience tells us there are three key ingredients for a successful programme: one, you must gain consumer acceptance; two, timing is key – you have to actively pre- pare people for what's to come; and three, encouraging behaviour change based on a series of nudges and incen- tives is essential for the programme to be effective and gain true value in terms of energy saving. Furthermore, the role of behavioural science can go beyond straightforward and not insignificant efficiency savings. It can also be used to help with the initial adop- tion of new technologies and could be a valuable part of the toolkit for managing next year's smart meter rollout successfully. We've seen the impact that behavioural science can have in other parts of the world, having helped 93 utili- ties in nine countries to save more than 5.6TWh to date. It will be interesting to see if last week's announce- ment translates into a national discussion on the poten- tial to reduce household energy consumption for the UK in the lead-up to the 2015 general election, and how utili- ties view their role in supporting this ambition. Claire Jakobbson, regulatory affairs manager, Opower