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Utility Week 13th October 2017

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8 | 13TH - 19TH OCTOBER 2017 | UTILITY WEEK Policy & Regulation Policy & Regulation younger voters, for whom environmental issues are a big concern, according to Sam Hall, an associate director at Bright Blue. At a conference fringe event, he cited polling carried out by the liberal Tory think- tank showing that climate change was the top concern among 18 to 24-year-olds. At the same meeting, BEIS (the Depart- ment for Business, Energy and Industrial Strategy) secretary of state Greg Clark made the case for environmentalism and conserva- tism going hand in hand. "A commitment to environmentalism and to being an optimistic and progressive force for the environment is an essential part of the mainstream Conserv- ativism that we must adopt," he said. Referring to his own work helping to reshape Tory environment policy under for- mer party leader David Cameron, Clark said the Conservatives should be "proud" of their record on the environmental agenda. He said: "If we just adopt things for differen- tiation, it's not a good strategy because they won't be lasting." He was backed up by energy minister Richard Harrington. The two are long-term friends, dating back to the 1980s when they were both members of the long defunct Social Democrat Party. This centre politics heritage helps to explain why Harrington was keen to bang the drum for consensus on energy policy. He said that until recently enthusiasm for environmental issues was seen as an "elec- toral ploy" by many Tories, who were turned off what they saw as a public relations stunt by Cameron when he took his famous trip to the Arctic. But he said mainstream opinion within the party had moved on from what he described as this "cynical" interpretation. Part of the reason why Conservatives can feel a bit more comfortable about embrac- ing a low carbon agenda is the falling cost of renewable generation, seen most visibly in last month's auction for offshore wind, which Harrington said had vindicated the government's financial backing for renew- able technologies. "It's a legitimate use of government money to kickstart what we think will be world class businesses," he said. Harrington felt sufficiently emboldened to flag his open-mindedness to onshore wind, which would once have been a taboo topic among the Tory grassroots. He commented that there was "no rea- son" why onshore wind should not enjoy a "level playing field" with other sources of electricity generation, provided that it went through the planning process. Even carbon capture and storage (CCS), which had the rug pulled out from under- neath it by ex-chancellor George Osborne two years ago, is back on the agenda for the upcoming clean growth strategy, due to be The Conservative promise to cap SVTs It was clearly designed to capture the public's attention, showing that Theresa May's com- mitment to helping what she dubbed the "just about managing" wasn't just warm words. Instead, the energy price cap legislation plan announced in the prime minister's speech to the Conservative party conference was liter- ally muffled by May's croaking delivery. The bill won't set a cap. Instead, accord- ing to a briefing note issued by Conservative party HQ to accompany May's speech, the dra legislation will give Ofgem beefed up powers to introduce a market wide cap on standard vari- able tariffs (SVTs). And any cap would only be in place for a temporary period, the note says, while the smart meter rollout beds in. The bill is designed to address the concern voiced by the energy regulator that it lacks the legal authority to cap all customers' bills, which business secretary Greg Clark asked it to do in the summer. However, getting legislation through parlia- ment will take time. There is solid support for price caps across the political spectrum, with the Democratic Unionists, Labour and the Scot- tish National Party all backing the idea in their recent election manifestoes. Nevertheless, any parliamentary vote is an invitation for opposition parties to make mischief with a government that lacks a stable majority. This is particularly the case in the febrile political environment where even apparently unrelated issues risk becoming proxies for the broader debate about the UK's withdrawal from the European Union. Added to that, Brexit means there is simply less parliamentary time for any other legisla- tion. Clark is still keen to persuade Ofgem to over- come its reservations about using its existing powers to introduce a cap on SVTs. Less than 12 hours before May's announce- ment, in an interview at a fringe event (see Q&A, right), Clark reiterated his view that going down this route would be a much quicker way to lower customers' bills. Clark has shown before in his ministerial career that he is adept at cutting deals with important interest groups. Perhaps he hopes that the threat of legislation will push Ofgem to set aside its concerns. "Onshore (wind) and solar both have a really important role to play. The challenge is making sure we can deliver to the right cost with the appropriate local support." Claire Perry, minister of state for climate change Centrica share price, 5 day (pence) 195 190 185 180 175 170 3 Oct 4 Oct 5 Oct 6 Oct 9 Oct "When we say that we want to sort out problems with excessive boardroom pay or energy prices we do that because we are pro- business and pro- competition. Damian Green, First Secretary of State

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