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UTILITY WEEK | 16TH - 22ND JUNE 2017 | 19 This week Political uncertainty could scare investors Hung parliament risks scaring away investors already worried by lack of clarity on energy policy The political uncertainty created by a hung parliament risks scar- ing off investors already worried by lack of clarity on energy policy, industry figures have warned. The election result could give them yet more reason to "sit on their money" and "wait and see", said UK Energy Research Centre chair Keith MacLean. Following Conservative leader Theresa May's announcement that her party will seek to form a govern- ment with the support of the Democratic Unionist Party (DUP), MacLean argued that even if the two parties can reach an agreement to work together, their combined majority will be so small and the arrangement will require "so much time to manage" that ministers will struggle to make difficult long-term decisions. "I fear that it's not good for the world of energy and I don't think that it can form a good basis for investor decisions," he told Utility Week. MacLean also raised concerns about the prospect of fresh elections if a stable government cannot be forged: "It's clearly a possibility that cannot be ruled out in a way that it could have been with a stronger majority. "That just creates a further reason [for investors] to sit on their money and wait and see, rather than do anything that might have a risk attached." Gareth Miller, chief executive of energy analyst Cornwall, agreed, saying: "Until we get the package of decisions, it's difficult for investors to know what they are investing in." He said he was worried that it could be some time before there was "a lasting political settlement that allows those decisions to be made". TG ENERGY EDF Energy Services buys Imtech EDF Energy Services has acquired engineering firm Imtech from investment company Endless for an undisclosed sum. Imtech's activities include the installation and maintenance of mechanical and electrical infra- structure and the operation and management of facilities. The company employs 2,100 people and generates annual revenues in excess of £400 million. EDF Energy Services is a joint venture between EDF Energy and French energy services firm Dalkia. EDF Energy said col- laboration between itself, Dalkia and Imtech will enable the latter to offer innovative products and services that "deliver improved energy efficiencies at every stage in the life of industrial and commercial facilities". ENERGY Centrica diversifies with home services Centrica has expanded into home services in a bid to capital- ise on the market, which has an estimated value of £5.7 billion. The energy supplier revealed on Monday that its Local Heroes service is open for business. The digital platform links consum- ers with trusted tradespeople, making it easier to get legitimate quotes for plumbing, heating, electrical and drainage jobs. All work conducted by listed "local heroes" will be backed by a 12-month guarantee from British Gas. ELECTRICITY Ofgem wants to slash DNO spending The energy regulator has set out proposals to cut spending allow- ances for distribution network operators (DNOs) by £206.8 mil- lion over the remainder of the RIIO-ED1 price control. The adjustments are possible, Ofgem says, because electricity distribution companies under- spent their allowances during the previous price control, DCPR5, which ended on 31 March 2015. Ofgem identified extensive underspends in reinforcement, due to lower than expected demand or because smarter, less costly, methods for ensuring reliability were discovered. Ofgem's review of DNO spending followed an announce- ment by National Grid in March that it would voluntarily defer £480 million of its allowed expenditure for transmission projects in RIIO1, which will ini- tially reduce network charges on energy bills by around £100 mil- lion between 2019 and 2021. Ofgem wants RIIO-ED1 reduc- tions to enhance these savings. DNOs have until 14 August to respond. Ofgem will make a final decision in September. MacLean: 'it's not good for the world of energy' Stock watch 1,540 1,520 1,500 1,480 1,460 CENTRICA SHARE PRICE, FIVE DAY SSE SHARE PRICE, FIVE DAY Shares in Centrica and SSE – both of which have high exposure to the UK energy retail market – shot up last Friday as investors digested the election results. The Conservatives and Labour vowed to introduce price caps but neither secured the majority needed to deliver their manifesto pledges on their own. Centrica shares rose 3.5 per cent to 205p in the opening trades, while SSE stock prices increased 1.9 per cent to 1,525p. Both gains have since been eroded. 210 205 200 195 8 Jun 9 Jun 12 Jun 13 Jun Finance & Investment PHOTO: IMAGECAPTURE pence pence 8 Jun 9 Jun 12 Jun 13 Jun