Utility Week

UTILITY WEEK | 27TH APRIL - 3RD MAY 2018 | 3 This week 4 | Seven days 6 | Utility Week Live We preview all the highlights of the UK's leading utilities exhibition and conference. 11 Policy & Regulation 11 | News Gove hails Ofwat's reform proposals 13 | Analysis Does a lack of policy direction mean the government has left it too late to decarbonise heat in the UK? 14 | Comment Drew Hendry MP, Inverness, Nairn, Badenoch and Strathspey 15 Finance & Investment 15 | News Yorkshire nearly rid of Cayman subsidiaries 18 Operations & Assets 18 | High viz Severn Trent bores tunnels under Newark 20 | Analysis The playbook for utilities business is about to be rewritten, in a new machine age 22 | Industry briefing Identifying the obstacles to a smart energy system 24 | Comment Mark Horsley, chief executive, Northern Gas Networks 27 | Market view Mobilising a workforce behind sustainable innovation 28 Customers 28 | News Ovo customers won't pay to drive their EVs 29 Community 31 | Disconnector GAS 24 | Comment Northern Gas Networks deals with a gas outage WATER 11 | News Green laws may be diluted after Brexit 15 | News Pollution incident costs Severn Trent £420k 18 | High viz Tunnelling under Newark with Severn Trent 27 | Market view Mobilising a workforce behind innovation ELECTRICITY 14 | Comment Drew Hendry MP on hydroelectricity 15 | News Rampion reaches capacity milestone 28 | News Plan to let customers have many suppliers ENERGY 11 | News Ofgem's thoughts on price cap published 13 | Analysis Can heat be decarbonised? 15 | News Scottish Power hikes prices 20 | Analysis Get ready for the new machine age 28 | News 'Make older smart meters interoperable' 28 | News Vulnerability commission announces members of panel Decarbonising heat is back with a bite The race to decarbonise the UK's energy supplies is a marathon, not a sprint – but when it comes to heat policy, the country's politicians and policy leaders are still at the starting line. Energy UK flagged the problem this month with a report high- lighting the lack of action from central government and setting out the steps that must be taken by the end of the next decade, when most gas boilers heating homes today will have reached the end of their lives (see analysis, p13). Although heat is responsible for a quarter of our greenhouse gas emissions, the pace of progress on a joined-up policy from ministers to meet the heat challenge – and particularly the role of gas within that – has been relatively glacial. This is despite major inroads from the gas distribution networks, which have been forging ahead finding innovative ways to decar- bonise the system, and from other heat providers such as district heat networks. Unfortunately, like all things filed in the "too difficult to deal with" tray, they come back to bite. The future of heat, having long been lower down the energy agenda than the more glamor- ous decarbonisation of power generation, is returning with a giant "priority" stamp. There is no longer any doubt that the one-time view that we should decarbonise heat – and transport – through electrification, is untenable. The gas distribution networks have won the argument: retaining a future for gas – with its ability to meet peak demand and seasonal flows, and give a practical use to billions of pounds' worth of infrastructure – is the right thing to do. So why hasn't anything been done? Not only is the finishing line nowhere in sight, no-one feels sure of the best way to get there. While refreshingly honest, the government's admission in last year's Clean Growth Strategy that heating is its "most difficult policy and technology challenge" in meeting reduction targets sounds wor- ringly like ministers kicking the can down the road. Now they've acknowledged the problem, they need to solve it. Let's face it, getting this wrong would be a hugely expensive political disaster. But time is running out: as industry awaits government's heat strategy, due at the end of the year, one thing is certain – standing still is not an option. Suzanne Heneghan, associate editor, suzanneheneghan@fav-house.com Leader Suzanne Heneghan Knowledge worth keeping Subscribers to Utility Week can access premium content and exclusive research, available to read online or as downloadable documents. http://www.utilityweek.co.uk/

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