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8 | 11TH -17TH SEPTEMBER 2015 | UTILITY WEEK Interview ness and de-layering, so you could have heads-of doing work within the busi- ness as opposed to a traditional direc- torates which are very siloed. It's much closer to the customer and allows us to move as technology changes, and the market changes as well." Horsley notes that the eight-year price review term, RIIO, which began in 2013 for gas distribution busi- nesses, has enabled him to think longer term and enact changes that would have been impossible under the pre- vious five-year regime. Under the contract, performance is measured against a wide range of targets, some of which need to be met or exceeded in order to earn rev- enue or avoid financial penalties. By keeping customer promises and improving efficiencies, NGN has gener- ated significant savings, driving down costs for custom- ers. He is confident that the mid-point review, which he welcomes, will show that the RIIO principles are being delivered. Horsley also credits NGN's owner, CKI, with allow- ing him the flexibility to change the business. Indeed, he can hardly find enough good things to say about CKI, which also owns UK Power Networks, now run by Hors- ley's predecessor at NGN, Basil Scarsella; fellow GDN Wales & West Utilities; and Northumbrian Water. "One of the strongest, successful elements of CKI is that they run their businesses independently – that makes great business sense. They believe in keeping things in a local- ity. We work closely together, we take advantage, but the local management is very important. It's a lesson I've learnt, as well, from being in larger organisations trying to bring things together and run it as a corporate." Horsley's corporate experience has not always been as happy as the job he so clearly loves today. He started out as a cra apprentice cable jointer at the electricity board, in 1975. By 2003, he'd worked his way up to become pres- ident and chief operating officer of CE Electric in the UK (now Northern Powergrid), owned by billionaire investor Warren Buffett. The job ended badly when, in 2006, the company breached its licence conditions in relation to quality of service. Horsley won't be drawn on the details of his departure but it is widely known that as chief oper- ating officer he took the rap, leaving the company swily when the breach was announced in 2006. It was a painful low point in what had been a strong career; the experience still moves Horsley, who explains how it changed his approach to business and manage- ment style, "humbling" him and leaving him less "com- mand and control". "I'd gone through this progression from an apprentice cable jointer to heading the business, over 30-odd years, and then all of a sudden you're back looking for a job like everybody else and that is a really humbling process for anybody, and I think I have carried that with me into this job. I drew on my own experiences of transformation and change and aimed to apply this to running a large utility. And I also hope I've brought some humility with me; a clear understanding of life; of getting to the top but also having everything taken away when you've got to the top, so that has made my style very different." Aer CE Electric, Horsley landed in EC Harris as a consultant, which he says was an "amazing experience". During this time a chance meeting with Basil Scarsella, and good fortune, found him being interviewed for the big job. He was cautious about a return to the corporate world, but a trip to Hong Kong to meet CKI's owners con- vinced him. "I was really geed-up by the interviews I had – it was all built on trust and promises and a family orientation, and it was completely different to the experience I had in the European firm and the Amer- ican firm." Horsley is now deeply com- mitted to CKI and its business values. Horsley's time at NGN has played out against a backdrop of huge change for the industry. The first research he read in office was the Redpoint report on the future of gas networks – "they didn't have a future!" – and the official government line was all about the electrification of heat. Today, things are very different. "There's a recognition of the cost of what the alternative would be if we didn't have gas in the mix… We're pas- sionate about having a future, and that's not just about gas, that's a future mix of renewables." Gas has not always spoken up for itself. Horsley is diplomatic, but muses as to whether the small num- ber of independent players in the sector, and the mixed interests of the behemoth National Grid, which also runs the power transmission system, have kept it quiet. If so, times have changed. Gas is one of the most exciting places to be in utilities right now. It's bubbling with ideas for the future, from the potential for the gas network to be used as a hydro- gen storage facility, which would effectively enable the storage of renewable power, to its potential role in shale gas distribution. All this while the networks are quietly getting on with replacing every metal pipe in the coun- try with plastic, and still connecting tens of thousands of new customers a year, many of whom will come out of fuel poverty as a result. So what's le to do? "Really, truly take NGN to a dif- ferent space. We're only part of the way on the journey. I think we're scratching the surface on customer, we're scratching the surface on the operating model. The team and I are planning the next three year journey, and it's about creating a conscious business built around capa- bilities. That's a massive shi, even with willing and new people." That's something to shout about – which comes hard to the gas sector, and to Horsley. But when fighting for your future, you've got to speak up. Horsley has been doing just that – he chairs the Energy Innovation Cen- tre (EIC), led by Denise Massey, a collaborative forum for bringing forward energy innovation by introducing SMEs to gas and power distribution networks, identifying smart solutions and accelerating their route to market. Under Horsley's chairmanship, the focus has broad- ened to include strategic, industry-wide innovation. This includes the advent of the EIC's Strategic Innovation Summits, the first of which was held last summer, and this month will see the networks collaborate on the first ever Customer Experience Summit, facilitated by the EIC. The EIC has been a passionate advocate for the future of gas, as has the Energy Networks Association, which is commissioning a major study into the fuel's future role. And of course, Horsley is here today – finally telling his story. "I'd gone from an apprentice cable jointer to chief executive, then all of a sudden [was] back looking for a job like everybody else" Mark Horsley will be interviewed live on stage by Ellen Bennett at the Utility Week Congress in October. Together they will explore how a traditional, asset-focused, price-regulated business can break the mould with innovation that delivers for customers, staff and investors. TM