Utility Week

UTILITY Week 12th June 2015

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UTILITY WEEK | 12TH - 18TH JUNE 2015 | 13 Policy & Regulation This week Rory Stewart named new water minister Second-term MP moves from defence committees to the water brief at Defra The new water minister has been named as Rory Stewart by the Department for Environment, Food and Rural Affairs (Defra). The MP joined Defra in May following the Conserva- tive victory in the general election. He replaces deposed Liberal Democrat MP Dan Rogerson, who lost his seat, as water minister, a role he held for two years between 2013 and 2015. Stewart's responsibilities include: the natural envi- ronment; floods and water; resource and environmental management; and rural affairs. He will be shadowed by Labour MP Barry Gardiner, who confirmed to Utility Week that he would replace Angela Smith as the water minister in the Labour shadow cabinet. Gardiner has significant environmental policy experience and will also be running for the position of Environmental Audit Committee chair. Stewart will deputise for environment secretary Liz Truss on the Environment Council and will have lead responsibility within the department for the Envi- ronment Agency, Natural England, and the Forestry Commission. Stewart has previously chaired the defence commit- tee and been a member of the National Security Strategy joint committee. He has been vocal in the past about support for farmers and for upland reform. George Eustice will continue in his role as farming minister. MB WATER CEO urges Ofwat to set PR19 standards The chief executive of Northum- brian Water has urged Ofwat to set minimum performance levels as part of the next price review. Heidi Mottram said while it was "absolutely right" for water companies to set their own cus- tomer priorities in their business plans, Ofwat needed to enable comparisons by having common performance measurements. Mottram told Utility Week the incentive regime for PR14 meant each water company "went off in slightly, and subtly, different directions", and was comparing itself against its own previous performance levels. "We were coming up with a situation where some companies could be earning a financial incentive for delivering a level of performance that other compa- nies would be penalised for," she said. "We need some kind of minimum standards." Her comments follow Welsh Water's criticism of Ofgem for introducing five horizontal incen- tives late in the PR14 process, as a means to compare the companies. Analysis, p19 WATER Taskforce defines resilience for sector The water industry taskforce created by Ofwat to determine what the resilience duty means for the sector has come up with a definition. The group, which has had two meetings so far, has an initial definition of resilience as "the ability to cope with, and recover from, disruption, trends and variability in order to maintain services for people and protect the natural environment". There are further discus- sions taking place within the taskforce, chaired by Waterwise managing director Jacob Tomp- kins, over the final wording of the definition, and it is likely the phrase "now and in the future" will be added. PAN-UTILITY Treasury slashes Decc, Defra budgets The Treasury has slashed the budgets of the Department of Energy and Climate Change (Decc) and the Department for Environment, Food and Rural Affairs (Defra) by more than £150 million collectively. Chancellor George Osborne has announced that Decc will see its budget scaled back by £70 million (about 2 per cent), while Defra is having £83 mil- lion (almost 4 per cent) taken off its £2.1 billion budget. Defra is expected to make savings in the administration of arm's length bodies, including Natural England and the Envi- ronment Agency. Stewart: first ministerial post Political Agenda Mathew Beech "Ed's promises have been echoing around Whitehall" The ghost of Ed Miliband – well, his general election campaign, because he can still be found on the Labour backbenches – is looming large over parliament. Think back to red Ed's hey- day, in the autumn of 2013, when his energy reform ideas grabbed the headlines and set the politi- cal agenda. He was calling for action on energy bills, targeting the big six in particular. Behind the price freeze promise there was also a plan to create an Energy Security Board Board seems to have morphed into the Office of Energy, with key industry figures, including Npower's Paul Massara, calling for the body to ensure there is "clear analysis of the perfor- mance and impact of all actions in delivering affordable secure low-carbon energy". So even though Miliband has le the political front line, there may be a legacy from his time as Labour leader. Something other than a backbench seat in the Commons, that is. – an independent body, similar to the Office for Budget Respon- sibility – to provide impartial data and help direct the best course of action to decarbonise the UK's energy system. Well, these promises appear to have been echoing around the sector. And Whitehall. Conservative energy secretary Amber Rudd has demanded that energy suppliers – in particular the big six – act to cut their bills and make them reflect the recent (downward) movement in wholesale prices. She says with the threat of the price freeze now gone, there are no excuses for the savings not to be passed on. And the Energy Security

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