Align network price controls to boost innovation
Ofgem should change to regulatory price control periods for gas and electricity networks in order to encourage joint investment planning and a "whole system" approach to decarbonisation, according to a leading academic.
24th January 2017 by Networks
There is increasing interest in the energy sector in the practicalities of delivering “multi-vector” or whole system planning and operation. To support this, Phil Taylor, head of the national Centre for Energy Systems Integration (CESI) at Newcastle University, has said changes are needed to the regulatory price controls for energy distribution networks.
“Ofgem are a regulator of both gas and electricity, but the regulatory periods for the gas and electricity networks are out of step with each other. They don’t sit side by side, so actually you can’t plan your investment in your gas and electricity networks in a joined up way,” he told Network.
Taylor went on the urge Ofgem to align the regulatory periods for gas and electricity distribution and to stipulate “joint investment policies” for networks sharing the same geographic license areas.
“If we believe that industrial strategy needs a whole system approach, then we need to change what we do in the energy space,” concluded Taylor, referencing government launch of a modern industrial strategy on Monday.
Taylor made his comments at the launch of a new report by Northern Gas Networks and consultancy KPMG in Westminster yesterday.
The report showed that a whole system approach to decarbonisation, including decarbonisation of the gas grid, could support significant growth in the energy industry in the north of England, boosting the local and national economy.
An additional £2.3bn could be generated in regional gross value added by 2050 if energy sector innovation – particularly for the decarbonisation of heat and transport – is encouraged in the area, said the report.
In tandem with the launch of the Energising the North report, Northern Gas Networks and CESI revealed a new partnership which will pour an initial £30m into the creation of a multi-vector energy innovation centre at Low Thornley, near Newcastle.
This will provide a “safe playground” for the demonstration of innovative whole energy system ideas, said Taylor.
Login on register to comment
Cadent backs launch of major bio-CNG HGV refuelling station
Gas network’s £250,000 infrastructure investment ensures supplies to existing connected customers have not been impacted
Editor’s blog: The biggest tests of resilience are yet to come
Network content director Jane Gray reflects on the industry's coronavirus response to date and the challenges still to come.
From the front line: Chris Garside and Andy Simcoe, Northern Gas Networks
Key workers across the power and gas networks are playing a critical role in the national response to Coronavirus. Network has committed to profiling their stories.
Related supplier content
Load patterns and lockdown: how Covid-19 is impacting electricity networks
Insights into dynamics on the low voltage network as the outbreak unfolds
Protect electrical equipment from insulation failure
Insulation faults are a major cause leading to the eventual failure of electrical equipment. Partial discharge (PD) is a very reliable indicator of developing insulation faults. Regular PD testing allows users to detect and analyze PD activity
How E.ON. is helping the City of London become a zero emissions city
Discover Citigen. Deep in the heart of our bustling capital