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Utility Week 24th February 2017

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10 | 24TH FEBRUARY - 2ND MARCH 2017 | UTILITY WEEK Policy & Regulation This week CUSC panel make-up 'favours incumbents' Chair of panel that administers industry codes stringently denies any lack of independent thought A row has broken out over the impartiality of actions carried out by the panel responsible for administering a key energy industry code. UK Power Reserve chief executive Tim Emrich told Utility Week that the Connection and Use of System Code (CUSC) panel is acting in a "mafia-like" way and is skewing ongoing modifications to network charg- ing arrangements in favour of large, established players. The CUSC panel is made up of an independent chair, a secretary and appointed representatives from Ofgem, National Grid and Citizens Advice as well as seven mem- bers representing energy system users who are elected every two years. Of the seven elected members, four are employed by big six energy companies – EDF Energy, Eon, SSE and Scottish Power. The remaining three work for Drax, First Hydro Company and trade association Energy UK. Emrich said that UK Power Research, as a relatively small industry player, has struggled to make its views heard during a recent review of embedded benefits. The firm stands to lose out if proposed changes to the embedded benefits regime go ahead. Tim Rotheray, director of the Association for Decen- tralised Energy, agreed that the panel's make-up does not reflect the "full breadth" of today's energy industry, but stopped short of saying panel members act in bad faith. The panel's independent chair Mike Toms and Ofgem have stringently denied any lack of independent think- ing on the panel. See analysis p12. TG ENERGY Labour Lords to block Euratom exit Labour's Lords team has tabled an amendment to the bill to authorise the triggering of the Article 50 notice, which will start negotiations to exit the EU. The government has said the UK will withdraw from the Eur- atom Community when it leaves the EU, but Labour is seeking to amend the bill to safeguard the UK's membership of Euratom when the Article 50 bill is debated in the House of Lords. Amendments to the legisla- tion are thought to have a greater chance of being passed by Parliament's upper house, where the Conservatives lack a majority. The Labour amendment states that the act, if passed, will have no bearing on the UK's membership of Euratom. It would require the government to treat the process of leaving Eur- atom separately from the wider EU withdrawal process. ENERGY Relaxed smart meter deadline rejected Energy minister Nick Hurd has told MPs that "it is not right to send any signal of slipping ambi- tion" on the 2020 deadline to fit all homes with smart meters. Speaking at a specially convened debate in Westminster Hall, he said: "This is a fun- damental piece in the broader picture of how we upgrade our critical energy infrastructure." However, Derek Thomas, Conservative MP for St Ives, said: "The 2020 deadline is too ambi- tious. The cost and expertise required for installing smart meters has been underestimated. "If we stick to the current deadline, the impact on con- sumer experience will undoubt- edly be negative." Shadow energy minister Alan Whitehead backed Thomas's call for a review of the timetable. ENERGY Uniper sets out Brexit concerns The chairman of Uniper UK, Felix Lerch, has urged govern- ment to "act rationally" and protect the current structure of the internal energy market dur- ing its negotiations to leave the European Union. He said "price risks, which are related to the internal energy market and the future of the UK relationship with its European neighbours", are a key concern. "As a European company, we see strong networks in the com- modities market and we want to see an ability to trade freely between different countries in energy matters," he continued. "This is our core business and we want to see this maintained aer the UK leaves the Euro- pean Union." Emrich says panel favours established players Political Agenda David Blackman "Many households may see a jump in their outgoings" Theresa May doesn't like to give a lot away. But one subject that the prime minister isn't coy about is her passion for fashion. It got her into hot water aer ex-education secretary of state Nicky Morgan criticised her erstwhile cabinet colleague for sporting a £955 pair of leather trousers in a photo shoot. This tale of the wrong trou- sers aside, May has a sure touch when addressing herself to those that she has labelled the JAMs – or 'just about managing'. post-Brexit Britain can work for ordinary people. Energy bills are high up the agenda for those shaping this paper: ideas in the mix are understood to include moves to encourage loyalty bonuses for long-standing customers. Grandstanding by politi- cians about energy costs may be unpalatable to utilities, but the fashion-conscious May will be aware that inflation-busting energy bill increases are never a good look in the eyes of voters. And they will be finding it a bit more difficult to keep on top of things with the publication of figures last week showing that inflation had risen to 1.8 per cent – its highest since mid-2014. With Brexit fuelling increased import prices and local authori- ties bumping up council tax rates in April, a lot of house- holds are likely to see a jump in their monthly outgoings, even before a host of fixed rate gas and electricity deals end. Good timing then for the consumer green paper. With prices once again on the rise, the green paper will be the centrepiece of the govern- ment's efforts to show that a

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