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NETWORK / 29 / OCTOBER 2017 I n August, the UK's energy network companies launched plans for the rst joint network innovation strategies. Energy Networks As- sociation (ENA) members will work together to develop two strategies; the Gas Network In- novation Strategy, and the Electricity Network Innovation Strategy, which will set out how companies will create exciting opportunities for the UK to bene t from new technologies across the whole energy system, such as battery storage, local renewable electricity gen- eration, and low-carbon heat sources such as biometh- ane and hydrogen. These strategies will be a key pillar in helping to deliver innovative trials that will underpin the roll-out of a smarter energy system for consumers across current and future price controls. In recent years, innovation has come to play an increasingly important role in the way network companies adapt to the challenges associated with decarbonisation, digitisation and decentralisation. This has been driven by the rapid increase in renewable generation connecting to the electricity distribution network, growing penetration of green gas, and greater interconnection between the gas and electricity net- works. It will be even more prominent as we decarbon- ise the heat and transport sectors at a national scale. The networks will be vital facilitators of the move to a low carbon economy, and innovation is at the heart of that transition. We have made a strong start. As regulated com- panies the regulatory framework for networks is fundamental to encouraging innovation and network companies have worked with the energy regulator Of- gem in developing a world-leading framework t for the 21st century. In 2010, Ofgem introduced the Low Carbon Network Fund (LCNF), a £500 million fund for electric- ity distribution networks to support ' agship projects trialling new technologies and innovative approaches to accommodating renewable generation connecting to the local networks. LCNF provided DNOs with the opportunity to explore the potential for a range of new technologies like battery storage and demand side re- sponse, and develop a technical understanding of how these technologies could work in the network and the bene ts they could deliver for customers. The projects supported by the LCNF have provided a foundation for the delivery of a smart grid in the UK which will improve e" ciency in the system, facilitate decarbonisation and, most importantly, ensure that cus- tomers bene t from lower costs and improved perform- ance in a low carbon future. There are already almost £1bn of savings from smart network solutions under the current ED1 price control and an independent analysis of the LCNF has shown that the innovation projects could deliver billions of pounds of savings for custom- ers if they are rolled out nationally. The success of this approach led to support for inno- vation being rolled out across all network sectors under the RIIO regulatory framework through the world-lead- ing Network Innovation Allowance (NIA) and annual Network Innovation Competitions (NICs) for further ' agship projects in gas and electricity. Gas Distribu- tion Networks (GDNs) have begun trialling innovations which have the potential to help the UK overcome the biggest energy challenge that we face in our e• orts to decarbonise; meeting peak demand for heat in a low carbon energy system. There is a growing body of independent research which suggests that the most practical and a• ordable pathway to decarbonising heat, which accounts for around half of our energy demand, is to use our existing gas network infrastructure to deliver low carbon gas. That demonstrates the tremendous importance of the innovation work being undertaken by GDNs to explore the practicalities of delivering hydrogen, biomethane or Bio-SNG through the gas grid. These gases could also support the decar- bonisation of industry and transport, as well as o• ering opportunities to store excess renewable electricity generation. The gas and electricity network innovation strategies are the rst time network companies have worked together in outlining their approach to innovation, and will be an important next step in shaping the future of the smarter, low carbon network. Each strategy will set out how network companies provide value for money for consumers from innovation projects they are undertak- ing, how they will share the lessons learnt from those projects with other organisations, and how they plan to integrate those lessons into their day-to-day operations. There will also be collaboration between electricity and gas networks to ensure that both strategies align as closely as possible with each other to deliver a whole system approach to innovation. The challenges we face are getting bigger and accelerating at a pace which was previously unexpected. Our ambition for innovation must match the scale of these challenges. "The challenges we face are getting bigger and accelerating." E N S U R I N G T H AT W E I N N OVAT E DAVID SMITH CHIEF EXECUTIVE ENERGY NET WORKS ASSOCIATION