Utility Week

UTILITY Week 15th July 2016

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6 | 15TH - 21ST JULY 2016 | UTILITY WEEK People & Opinion Policy uncertainty is biggest challenge Survey reveals need for greater policy continuity to facilitate the transition to a low-carbon system. Chief executive's view Louise Kingham, Energy Institute L ast month saw the launch of our second annual Energy Barometer report, a sur- vey of UK energy professionals within the Energy Institute (EI) membership on issues facing the industry. Dominating the find- ings is a call for greater energy policy continuity to attract investment towards the develop- ment of a secure, sustainable and affordable energy system. For the second year running, EI members describe policy uncertainty as the biggest chal- lenge, with a sense of pessimism about the industry's ability to transform the energy infrastruc- ture within the timeline, set by government, to effect the transi- tion to a low carbon economy. No one doubts that decarbonis- ing the energy system is achiev- able. Their concern is that without a clear, consistent narra- tive, investor confidence reduces at a critical time in energy sys- tem development. The outcome of the EU referendum adds insult to injury, because further uncer- tainty has been introduced and an oen-quoted "stable" envi- ronment to invest and operate in is perceived now by some as less stable. In the Barometer survey, pub- lished before the referendum result was known, energy profes- sionals anticipated Brexit would have an overall negative impact on the energy industry – so they will be following political devel- opments particularly closely. The other main reason for current reductions in invest- ment in the energy sector is the lower price of crude oil – driven by global factors over which the UK has little or no control, but where the impact is being felt. But easing uncertainty around policy continuity is something we can influence by having a consistent narrative in place that is repeated at every opportunity – reminding us what the policy is, how we are pro- gressing and what more needs to be done. Stakeholders need to be actively engaged in ensuring that any instruments designed to facilitate progress do just that. If and when that turns out not to be the case, or that part of the story completes, we should say so and explain our next steps for some time ahead – not change the direction without warning, which is what I believe lies at the heart of this concern about policy continuity. It's a matter of communication, not indecision. Strengthening the narrative and aligning it with the long-term vision energy investors need will do much to build the confidence necessary for this transformation to take place. EI members see the need to maintain the momentum towards delivering the new low carbon infrastructure as particu- larly important. They also tell us that better communication with the public is essential to foster the greater understanding that will enable us to deploy it. Building understanding takes commitment and trust has to be earned, and we all have a role to play here: companies by doing the right thing and acting responsibly; policymakers by working consistently from a good evidence base; others, like the EI and the media, by improving understanding and the quality of the debate. Developing posi- tive public engagement requires a long-term commitment to get it right. The Energy Barometer launch took place alongside the Energy Systems Conference, which the EI hosts every other year in part- nership with publisher Elsevier. This event brought together key energy stakeholders and exam- ined new thinking around the structures, processes and poli- cies needed to develop a more integrated, intelligent energy system. Participants scrutinised the interactions between differ- ent parts of the energy system along with the role and impacts that technology, people, eco- nomics and policy have. But most interestingly, the call that registered with the energy professionals participating was that the energy system should be viewed as one integrated sys- tem among a number that has to be developed to support society effectively into the future. To read more about the find- ings from the Energy Barometer report or the Energy Systems Con- ference, go to www.energyinst. org/energy-barometer and www. energysystemsconference.com. "There is no change to our commitment to a clear energy policy framework and a strong, investment-friendly economy – making the UK one of the best places in the world to live and do business." Energy minister Andrea Leadsom speaking at the Utility Week Energy Summit. Read more on page 12. Priorities versus perceived priorities

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