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Utility Week 20th October 2017

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UTILITY WEEK | 20TH - 26TH OCTOBER 2017 | 7 Policy & Regulation This week Sandys: end energy policy 'obsessions' Report says the focus on the energy trilemma is leading to bad policy decisions A report, co-authored by Laura Sandys, has called for a bonfire of the traditional "obsessions" of energy policymakers and regula- tors in order to enable a radically new regulatory model. The report, "Reshaping Regu- lation", claims that an undue focus on the energy "trilemma", as well as fuel poverty and security of supply, have "distorted" policymaking and regulation "for too long". To realise a low-carbon future with decentralised generation, demand-side participation and innovative smart home services, the report insists a new policy and regulatory model is needed. To help achieve a fresh regulatory approach, the report's authors called for a review "of all bodies cur- rently regulating the energy sector, with a clear ambition to rationalise, simplify and identify any 'gaming' of the complexity". The report also says the "misplaced responsibility given to the energy sector" to act against fuel poverty "should be removed". "Fuel poverty is not an energy problem, but either one of real poverty or of bad housing, and as a result should sit clearly within a different set of policy areas and departments," reads the report. On the energy trilemma, which has dominated policymaking for decades, the report says: "The term 'trilemma' has created the impression that there are trade-offs, that these are competing problems rather than complementary ambitions, and it shapes an inher- ently zero-sum game." JG ENERGY BEIS acts on risks to SMETS2 transition The Department for Business, Energy and Industrial Strategy (BEIS) has opened a consulta- tion on the actions it should take to avoid negative impacts arising from the transition to SMETS2 meter installation in the national smart meter rollout. A statement on the BEIS website said the consultation had been launched in recognition of a number of risks faced by suppli- ers if the current end date for the rollout of SMETS1 meters remains in place, without any flexibility. The statement said the exist- ing cut-off date for the installa- tion of SMETS1 meters – 13 July 2018 – had been put in place to "support and incentivise an efficient transition to SMETS2 meters". But it admitted that "despite detailed planning, a smooth transition to installing exclusively SMETS2 meters at scale may take time". Interested parties have until 10 November to respond to BEIS's consultation. ENERGY Eon: SNP firm just another competitor The SNP's pledge to launch a not for profit, publicly owned energy company "will not change the market", Eon UK's chief execu- tive Michael Lewis has claimed. Speaking at Utility Week Congress last week, Lewis responded to an audience ques- tion on the potential impact of the SNP policy announcement, saying: "We've already got around 60 competitors in the market, one more isn't going to change that picture." He added that plenty of not for profit, municipality-owned energy firms already exist and are competing with mainstream players – such as Bristol Energy. "It's another competitor in the market," he concluded. "It doesn't change the market. It just shows how competitive the market is." ELECTRICITY Government under pressure over onshore windfarms The government faces further pressure to relax its opposition to onshore windfarms following an announcement that its own infrastructure adviser is investi- gating barriers to their rollout. The National Infrastructure Commission, which is chaired by the former Labour minister Lord Adonis, published its interim National Infrastructure Assess- ment (NIA) last Friday. It states that the NIC is exam- ining "unnecessary barriers" to the deployment of onshore wind projects, highlighting how they do not benefit from subsidies like their offshore counterparts. New policy and regulatory model needed Political Agenda David Blackman "Draft bill could be a mechanism to push Ofgem" The government came under pressure last week from the oppo- sition over the pace of its much trumpeted crackdown on prices. It's a fair question because despite the grandstanding, ministers are displaying a lack of urgency on the topic. Ministers have published a dra bill instead of heading straight to legislation. Dra bills have only been around since the Blair govern- ment, when the mechanism was invented to improve the could be introduced. It begs the question, therefore, why has the government used the mecha- nism in this particular instance? The reason may be that the cerebral Greg Clark wants to ensure the bill is watertight when it reaches parliament. But a cynic might suspect the government doesn't really want to legislate if it can avoid it, given the amount of time Brexit is likely to chew up. Instead, the dra bill could be a mechanism to push Ofgem into action. quality of legislation. It became standard practice for laws to be published in dra form to iron out problems before they hit the politically charged atmosphere of the House of Commons chamber. But dra bills have gone out of fashion since the coalition came to power. While there were more than ten published in 2012, there have only been three in each of the past two years. It is unclear how long the pro- cess of prelegislative scrutiny will take or indeed the time it will take to go through parliament. Then, once the legislation has cleared Westminster, Ofgem has estimated it will be at least another five months before a cap

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