Five things we learnt from Energy Spectrum | 673

In the week that National Grid is set to launch its 2019 Future Energy Scenarios (FES), this week’s Energy Perspective looks more closely at how new approaches could make it more attractive for small generators to connect to the transmission system. While we await with interest to see how FES treats these issues, the vision will likely involve connecting small as well as large power plants to a well-planned and managed transmission network – another step towards a renewables-focussed version of the transmission network as a step towards the 2050 net zero target.

The government’s Green Finance Strategy, published 2 July, is aimed at changing the behaviour of the financial sector, from the way it evaluates company performance to the services it offers customers. We look in more detail at the strategy in our Policy section this week, suggesting that all companies will come under growing pressure to increase the quantity and quality of data they provide on their climate impacts. In the same section we take in a Treasury Select Committee evidence session on the economic opportunities from decarbonisation and green growth which, through evidence given, made clear that while power decarbonisation has been achieved by and large without disruption to consumers, transport and heat will require behaviour change.

Ofgem’s latest consultation setting out the next steps in the development of the enduring Retail Energy Code is another very large consultation in the Switching Programme that covers numerous topics. In this week’s Regulation section, we dig down on the details, finding that the scope for amalgamating codes is considerable but some areas – like theft and the GDAA – will require further thought.

The latest switching figure from both Energy UK and Xoserve’s show that domestic switching is now at record highs. We analyse the data in our Industry Structure section, finding that the switching data sets measure differently, but for both gas and electricity we think switching is at least 20%. That for gas is nominally higher as Xoserve’s switching numbers include supplier of last resort transfers. Both rates are up at least two percentage points in a year.

We have two Nutwood’s this week. In the first, Cornwall Insight Associate Peter Atherton discusses the approach of the H119 results season and gives some pointers on what investors might be looking for; the second distils a presentation from Cornwall Insight Chairman Volker Beckers at Imperial College Business School under the theme of ‘a practitioner’s view of electricity market privatisation and liberalisation’.

Related thinking

Home supply and services

Reforming Energy Bills: What’s on the Table?

There has been much speculation in the energy industry over what reforms to household energy bills could potentially be introduced, particularly with Ofgem due to announce its Q3 (July – September) 2024 Default Tariff Cap figures on Friday (24th). With so many areas under review, we’ve put together an overview...

Low carbon generation

Latest developments in the TPI space

We recently published our 2023 Annual TPI report which provides an independent review and analysis of the market for TPIs, and the services provided by them. The report also looks at the current challenges and opportunities for TPIs, such as regulatory changes, competition with suppliers, and diversification of services. 2023...

Regulation and policy

What’s going on with REGOs?

Renewable Energy Guarantees of Origin, more commonly referred to as REGOs, are certificates issued to accredited renewable generators for every MWh of electricity they produce over a year period. The initial intentions of these certificates were to provide suppliers a means to prove the level of renewable generation they received...

Home supply and services

Ofgem strives to improve consumer experiences across both the domestic and non-domestic sectors

Over the last week, a number of anticipated publications were issued by Ofgem that hold the potential to make a significant change to the requirements on both domestic and non-domestic suppliers. The findings of Ofgem’s non-domestic market review were revealed, alongside a policy consultation on the options available to address...

Energy storage and flexibility

Waiting to connect: the problems and solutions for network connection queues (Part 2)

Network connection queues continue to be a notable topic of interest as many generators face significant delays to project development – an issue that is directly conflicting with net zero ambitions and recent focuses on strengthening domestic energy supplies. In Part 1 of our two-part series on connection queues we...

Home supply and services

Addressing consumer harms in the non-domestic market

In recent months, Ofgem has shone a light on areas across both the domestic and non-domestic market where suppliers could improve their practices for customers and go beyond what they are obligated to do in the licence conditions. In a time of significant and extended volatility, the regulator has brought...

Energy storage and flexibility

Waiting to connect: the problems and solutions for network connection queues

The number of grid applications has risen significantly in recent years, resulting in increased pressure on the electricity networks to facilitate new connections. In its Energy Security Strategy, the UK government set out ambitions for 95% of electricity to be sourced from low carbon generation by 2030, and for the...

Energy Market Design

Are prices going to rise in Contracts for Difference Allocation Round 5?

A number of factors may be about to put an end to the trend for falling energy prices in the Contracts For Difference (CfD) scheme. The CfD scheme has provided strong subsidy support whilst also providing consumers robust levels of protection. High investor confidence and steady reductions in capital costs...