Utility Week

UTILITY Week 30th October 2015

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10 | 30TH OCTOBER - 5TH NOVEMBER 2015 | UTILITY WEEK Policy & Regulation This week RIIO must evolve, says former Grid exec Winser dismisses claim the framework needs to be preserved to maintain investor confidence RIIO must be allowed to evolve in response to the transforma- tion of the energy system, says Energy Systems Catapult chair Nick Winser. The former National Grid executive director and architect of the RIIO regulatory framework has said that the RIIO model must be allowed to evolve in response to a changing energy system, including the rise of distributed generation and demand-side technologies. "RIIO was a massive step forward for encouragement of innovation. And it massively moved forward regula- tion of utilities," said Winser in an interview with Utility Week (p6). "But I am sure there will be good debate about what will be fit for purpose as you see the emerg- ing picture of all these different dimensions of change, right across the energy system." Winser knocked back the idea that there is a need to preserve the RIIO framework in its current format to main- tain investor confidence. "Change is just part of the evolu- tionary progress. We all need to be ready to see the model evolve in a sensible way to reflect the changing views of the transformation of the energy system," he said. Winser advocated the creation of a framework which encourages innovation, not only from power and gas distribution network companies but also from small sup- pliers and universities. He said there is a need to "think positively" about such reforms to "business models and market structures" because the rise of distributed technologies will "require very many different players to work together with broad-based incentives". JG ELECTRICITY Lords defy the government in vote on the closure of RO The House of Lords last week voted in favour of scrapping the government's plans to close its Renewables Obligation (RO) scheme a year early, effectively blocking its progress in becoming law. The peers defied convention by opposing a ruling party's election manifesto pledge, voting in support of Labour's amendment to the Energy Bill, which will prevent the govern- ment from shutting the support scheme sooner than planned. For the renewables industry the move buoys hope that the RO closure might be soened in order to pass through as law. Gordon Edge, Renewable UK's director of policy, said following the vote that although the delay increases uncertainty, it sends a clear message to government that shutting onshore wind sup- port prematurely is "a mistake". ENERGY UK and China ink clean energy deal The UK and Chinese governments last Friday signed an agreement to share knowledge and encour- age investment in clean energy technologies in both countries. The Clean Energy Partnership will enable UK companies to share their expertise in low- carbon innovation and secure new business in the Chinese energy market. It is also hoped that the deal will encourage more investment in clean tech- nologies, helping reduce costs to consumers in both countries. The deal came as part of a state visit by Chinese president Xi Jinping in which a number of agreements were announced, including the first ever Chinese investment in the UK offshore wind market, and the establish- ment of joint offshore wind industry advisory groups. ENERGY BIS to explore switching principles The Department for Business, Innovation and Skills (BIS) has called for evidence on how a set of switching principles appli- cable across the three sectors of energy, telecoms and current accounts could be implemented. The government is investigat- ing how such principles could make the switching process easier so customers can take advantage more readily of savings on offer. The principles include that consumers should also be allowed access to their con- sumption or transaction data in an easily reused format and that consumers should be able to authorise third parties such as comparison sites to access the data to help them switch. Winser: "RIIO was a massive step forward" Political Agenda Jillian Ambrose "Energy firms should clear the air on energy use data" Brace yourselves, energy com- panies. Although the political storm of the Competition and Markets Authority probe seems likely to lose intensity before making landfall next April, a fresh hailstorm of political pressure is brewing. It may have come as a relief this week as the media glare shied from energy utilities to telecoms, but savvy suppliers will already have realised that the TalkTalk data hack signals par- ticular trouble for energy firms. prove to be the final nail in the coffin of consumer engage- ment. Politicians will doubtless take the opportunity to score points with the electorate by insist- ing on watertight data rules for big companies – as well they should. But rather than hunker- ing down to weather yet another storm, energy companies should also seize the opportunity to clear the air on energy use data and plans to safeguard privacy. Forewarned is forearmed. This week, the issue of data protection comes a close second to tax credits in holding West- minster's oen fickle attention. But with business and media minister Ed Vaizey calling on all FTSE 350 companies to ensure "robust" data protection proce- dures, the pressure is only likely to increase. The smart meter rollout is set to expose energy companies to a level of data risk unprecedented in the sector. And worryingly, it has already raised concerns over data privacy years before meters reach the majority of UK homes. For an industry-wide initiative hoping to help rebuild trust, a data privacy scandal could

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