Utility Week

Utility Week 16th June 2017

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Page 11 of 31

12 | 16TH - 22ND JUNE 2017 | UTILITY WEEK Ministerial moves Prime minister Theresa May has completed a mini ministerial reshuffle, which has seen some movement with Defra and BEIS as her new, minority government takes shape. Andrea Leadsom. The former environment secretary, and one- time challenger to May as party leader, has been promoted. She moves from Defra and is now the leader of the Commons. Nick Hurd. The climate change minister is another Conservative who has been promoted in the wake of the election. He leaves BEIS for the Home Office. Policy & Regulation ENERGY Price cap will happen 'quickly' Former Npower boss Paul Massara, who is now chief executive of North Star Solar, said he believes the new minority administration is "going to push on with the cap and I think they will want to move on that quite quickly". Massara added he can see issues such as energy effi- ciency and insulation moving forward, but "some of the more contentious messages will be difficult". ELECTRICITY Renewables 'ready to deliver' The existence of a hung parliament should be no bar to progress on renewable energy and emissions reduc- tion because of a cross-party consensus on decarbonising the economy, according to industry bodies. Renewable UK chief execu- tive Hugh McNeal urged all Westminster politicians to use the consensus on decar- bonisation to put renewable generation at the heart of UK energy policy and called on the new Conservative govern- ment to ensure a stable policy framework for renewables. ENERGY New government may stay in EU energy market The failure of the Conserva- tives to retain a majority may put pressure on the party to continue Britain's member- ship of the internal energy market post-Brexit. The election results could push the Tories into reaching a compromise with those who would prefer a soer depar- ture from the EU, according to energy analysts Cornwall. See more utilities election news on p8. Election briefs Analysis The markets respond No-one anticipated a Labour revival, but the financial markets have largely taken the result in their stride. Nigel Hawkins reports. F ollowing a lacklustre campaign, inter- spersed by some appalling terrorist outrages, the Conservative party, under Theresa May, failed to secure a majority in the general election. A hung parliament is the result, with May staying on as prime minister – for the moment. Remarkably, the stock market remained rock solid – the FTSE 100 was up by c40 points last Friday lunchtime – despite all the Brexit-related issues that now arise. Interestingly, very few opinion polls had predicted the result – and virtually none had the Labour party's share of the vote exceed- ing 40 per cent. And, despite an initial fall in sterling, there were no major stock market movements such as those generated by the equally surprising Brexit result a year ago. Nor did water stocks move significantly on the back of the result – unlike in 1992, when the unexpected Conservative party win boosted water stocks by no less than 18 per cent on the day aer the actual election. But last week's result will concern many overseas investors, both in terms of the tre- mendous uncertainty created, especially on delivering Brexit, and of the very radical economic and renationalisation policies put forward by the Labour party. In fact, by lunchtime the day aer the election, the two leading utilities – National Grid and Centrica – were trading very slightly below the previous day's closing prices. SSE's shares, by contrast, were mar- ginally higher. Water stocks maintained their solid advance since the last periodic review, although the threat of renationalisation by an incoming Labour government has not disappeared. Despite the very surprising result, there remains unfinished business for the minor- ity Conservative government in the energy sector. The Conservatives' manifesto proclaimed that "our ambition is that the UK should have the lowest energy costs in Europe, both for households and business". An ambitious target indeed. Furthermore, the manifesto confirmed that there would be yet another "independ- ent review into the cost of energy". In terms of renewable electricity gen- eration, offshore wind development and the ➡ OUT Michael Gove. The former education secretary, who stood against Theresa May last year in the leadership contest, returns to the cabinet aer being ousted by the prime minister. He has oen voted against environmental legislation in parliament, such as voting against explicitly requiring an environmental permit for hydraulic fracturing activities in January 2015. Gove has controversially been named as the new environment secretary, and will replace Leadsom at Defra. Claire Perry. The MP for Devizes, and former Parliamentary Under Secretary of State for Transport, will join BEIS as a junior minister. She is set to be a direct replacement for Hurd as climate change minister, although her ministerial responsibilities have not yet been announced. ➡ OUT ➡ IN ➡ IN

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