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UTILITY Week 12th June 2015

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UTILITY WEEK | 12TH - 18TH JUNE 2015 | 3 Leader Ellen Bennett This week 4 | Seven days 6 | People & Opinion 8 | Interview Alan Lovell, chair, CCWater 13 Policy & Regulation 13 | News SNP's MacNeil poised to head committee 15 Finance & Investment 15 | News Swansea Bay Tidal gets planning consent 19 | Analysis Ofwat must learn from problems encountered in PR14 20 | Analysis Ofwat and Bristol Water battle on 21 | Analyst view Martin Brough 22 Operations & Assets 22 | High viz RWE's Staythorpe power plant 23 | Pipe up Tony Stiff 24 | Event The Innovation Exchange: innovate to accumulate 26 | Market view Following the carbon trail 27 Customers 27 | News Eon to roll out smart energy offering 28 Markets & Trading 28 | News Centrica and SSE top Grid capacity awards 29 | Market view Liquidity is key to competition 30 Community 30 | Reader of the week John Scott, Chiltern Power 31 | Disconnector Rory Stewart's in-tray And so a warm welcome to Rory Stewart, who was finally confirmed as the water minister last week – four weeks aer the election. The sector might chafe at the apparent lack of high-level interest in water this demonstrates, but it arguably sees them better off than their peers in energy. While energy secretary Amber Rudd's appoint- ment was one of the first made by a triumphant David Cameron, the media demanded instant headlines – and Rudd obliged, moving quickly to enact the Tories' policies on onshore wind. Stewart, a relative newcomer, has the chance to get to know the sector and its issues before making his move – and here's the top six issues we think should be on his list: 1. Stewart will want to get quickly up to speed with Bristol Water's appeal against its PR14 determination, currently in front of the Competition and Markets Authority. As Nigel Hawkins comments on page 20, a favourable CMA intervention on its Wacc, while unlikely, would have far-reaching implications. 2. The water companies have responded to the regulator's request for a grown-up conversation by coming out and saying just what they think was wrong with PR14 (see analysis, p19). As Ofwat facilitates a "big debate" ahead of its Water 2020 programme, there is an opportunity for the incoming minister to understand both the regulator's and the companies' positions. 3. Customer engagement in general, and social tariffs in particular, is one area where the minister's view will be influential. The new Consumer Council for Water chairman Alan Lovell has some ideas around social tariffs – see interview, p8 – and will also be look- ing for a view from Stewart on how, and to what extent, customer engagement should form a part of the next price review. 4. Company tax and overseas ownership are almost certain to come back to the top of the agenda. Ofwat caught the political mood early and has been anticipating increased scrutiny of the sector with its moves on transparency and governance. It was interesting to see SSE sign up to the Fair Tax Mark this week – a move water companies may wish to consider. 5. Now the election is over, there's no excuse not to get started on abstraction and upstream reform. Should competition extend into the wholesale market? Stewart will need to form a view – which could prove crucial. 6. Last, but by no means least, the opening of the water market to competition for non-household customers in 2017 should be high on Stewart's list. Aer all, if preparations run late, he would make the call: is it more important to open on time, or to get it right? Ellen Bennett, Editor ellen.bennett@fav-house.com GAS 15 | Stock watch Drax results WATER 8 | Interview Alan Lovell, chair, CCWater 13 | News Taskforce defines resilience for sector 19 | Analysis Ofwat must learn from problems encountered in PR14 20 | Analysis Ofwat and Bristol Water battle on 24 | Event The Innovation Exchange: innovate to accumulate ELECTRICITY 15 | News Swansea Bay Tidal gets planning consent 15 | News Scottish Power gets consent for Glen App windfarm 22 | High viz RWE's Staythorpe power plant 28 | News Centrica and SSE top Grid capacity awards ENERGY 13 | News SNP's MacNeil poised to head committee 26 | Market view Following the carbon trail 27 | News Eon to roll out smart energy offering in the UK 28 | News Elexon calls for market overhaul Knowledge worth keeping Visit the Downloads section of Utility Week's website http://www.utilityweek.co.uk/ downloads Schneider Electric: Modicon M580. It's a revolution. Every time. http://bit.ly/1FZogqK Cognizant: Using Predictive Analytics to Optimise Asset Maintenance in the Utilities Industry http://bit.ly/1cBKZP0

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