Bulletin 8 March

Issue 269: Tuesday 8 March 2011  

  • ENA on Breakfast News on metal theft  

  • ENA launch street works book with Minister  

  • Electricity workers safety initiative website launched  

  • Boris’ Adviser and DfT at ENA/SBGI Street Works Seminar  

  • National Grid set out their energy vision  

  • Gas could have much bigger role says Huhne  

  • E.On sells Central Networks to PPL Corporation  

  • Smarter grid research centre launched in Scotland

  • SHE 2011

  • Forthcoming events organised and/or supported by ENA  

______________________________________________________________  

ENA interviewed on Radio 5 Live on metal theft  

As a continuation of our campaign to address the issue of metal theft ENA were interviewed on BBC Breakfast TV News on 24th February. This followed interviews on Radio Five Live and BBC Three Counties Radio the week before. At our suggestion the BBC had a live broadcast from a site in Gloucestershire where high voltage overhead line had been stolen last November. The theft took place over a football playing field and it provided a powerful visual impression of the impact these thefts can have. As part of the weeks continuing media campaign ENA were also interviewed live on the BBC Radio Gloucestershire Breakfast Show.  

On both programmes we explained how metal theft continues to grow and showed how it impacts on society. We called for changes to the law on scrap dealers thus stopping the means of disposing with the stolen metal. The current legislation is from the time of Steptoe and Son. We believe that greater police powers to close sites which have stolen metal, coupled with an effective registration scheme and a cashless system will stop most of the thefts.  

We highlighted the fact that this problem has grown considerably over the years. We sent out the stark message that it impacts on the thieves (several die each year), it impacts on the public and it impacts on society as a whole.  

It exposes the public to danger – although companies make the sites safe very quickly. We talked about the impact on the economy and the societal impact on schools, care homes and local communities.  

As part of our continuing campaign we are now planning a Parliamentary metal theft briefing where we aim to raise the profile of the issue with MPs and hope to hear from the Crime Prevention Minister.  

______________________________________________________________  

ENA launch street works book with Minister  

The Department for Transport Minister responsible for street works, Norman Baker MP, leant his and the Departments support to a new book that has been published by ENA. The book, ‘Partnering: leading transformational and cultural change’ is written by Richard Wakelen of UK Power Networks and Roger Williams of East Sussex County Council, and tells of the proactive approach taken by the utility company and the local authority to forge a better working relationship.  

Commending the work of the individuals involved as well as NUAG and ENA, Norman Baker described partnership as “a no-brainer with the potential to deliver absolute benefits”. He spoke of the norm being for people to reach for the statute book for the approach they should take but instead advocated the better story – one of cooperation and understanding through partnership.  

He went on to say that they key message in this area is that ‘partnership makes sense’, delivering for the utility and the local authority through simpler and better processes, and for the public through better infrastructure delivered in a way that minimises impact. Hoping that the book will be spread across the UKs local authorities he said, “who could complain about less cost and less hassle”.   ______________________________________________________________  

Electricity workers safety initiative website launched  

A new website has been launched, providing a focal point for the Electricity Industry’s latest health and safety strategy – Powering Improvement.  

The site, www.poweringimprovement.org, will host case studies and tools for practitioners, helping to further the work of this major initiative throughout the industry. The first of five yearly progress reports covering 2010 is available on the site introducing one of the overarching themes of leadership. It includes Chief Executive level endorsements as well as support from HSE and the trade unions via Brendon Barber, General Secretary of the TUC.  

As part of raising the profile of this work, a number of events will be used this year to highlight the value of effective health and safety engagement to both individuals and businesses. As well as presentations at numerous health and safety conferences ENA will also be holding a Parliamentary reception in the House of Lords with Baroness Smith, opposition spokesperson for Energy and Climate Change on 25 May 2011.  

The drive behind Powering Improvement comes from industry bodies Energy Networks Association (ENA) and the Association of Electricity Producers (AEP) who are working closely with industry trade unions and the Health and Safety Executive (HSE).  

Their ambition is for the industry to be one of the world leaders in health and safety performance by 2015. Peter McCormick, ENA Board lead on Safety, Health & Environment said, “Workers in the electricity industry face many significant risks which need to be managed. Key to this risk management is strong leadership, where senior staff members take ownership of risks and accept the responsibility of managing them.  

“Through their work on this strategy, ENA and AEP are leading by example, exhibiting the sort of leadership skills they want to establish across the industry.  

“The first step was for senior managers in ENA/AEP companies to demonstrate their commitment by publicly signing up to Powering Improvement. The second step was to build on this by improving health and safety leadership throughout the management chain so that good practice cascades to all levels of workers. As this continues, 2011 will focus on occupational health and wellbeing and will look to reduce the number of work related ill-health risks.”   ______________________________________________________________  

Boris’ Adviser and DfT at ENA/SBGI Street Works Seminar  

The joint one-day seminar heard from a wide range of speakers on policy topics from developing government thoughts in this area, permit schemes and the proposed lane rental in London. There were also presentations on the 2012 Olympic preparations by Transport for London and Balfour Beatty’s efforts to deliver infrastructure in a safer, better, leaner and faster way.  

Richard Buckley, Deputy Director of Traffic Management at the Department for Transport, explained that although government policy in this area was still very much a work-in-progress that the principles of localism would filter through to street works too. The attitude of utilities, contractors and local authorities waiting to be told how they should interact needed to change and that if they found solutions then not to look to Whitehall before they make progress but to act together in the best interests of the public. Where legislation was a necessity then it would be written in a way to be supportive and complementary to local cooperation.  

The event also heard from Kulveer Ranger, the Mayor of London’s Advisor for Transport. Kulveer spoke of a desire to see utilities planning works better and with a more joined up approach between the different utility improvements that were needed. He explained that the proposed lane rental scheme for London would encourage contractors to avoid problems and plan better. It was not about generating income but driving innovation and the lane rental money would be used to encourage new technology that minimises the amount of space on the road and disruption to the public.   ______________________________________________________________  

National Grid set out their energy vision  

Last week National Grid’s Steve Holliday gave a speech which focused the policy and media world on the role for a smarter grid to address our energy challenges.  

Steve said that 2011 is a “pivotal” year for the UK energy market and that the Electricity Market Reform needs to create the right incentives to invest in renewable power generation. Such incentives, alongside a joined-up and coherent approach from government and the need to press ahead with CCS projects, will determine our ability to meet energy needs and climate change targets.  

He used the example of offshore wind as an area in need of great coordination nationally suggesting that this could have savings of £3-5bn which would be better spent on making the grid smarter. He also said that the CCS projects provided a “unique opportunity [to develop] exportable expertise”.  

On the energy mix he said that retiring power plants presented an opportunity to “green” the economy but only with the right market conditions. He believed it was “an optional extra, but...is affordable and it would generate jobs”. He saw this as an “infrastructure opportunity”. He also envisages nuclear will have a growing role to play but the role of gas will change, moving from a fuel that is the back bone to one that is a back-up.  

He takes over from Lord Browne this summer as President of the Royal Academy of Engineering and also spoke about the skills shortage, something he says threatens the UKs ability to achieve climate change targets.  

______________________________________________________________  

Gas could have much bigger role says Huhne  

3rd March saw DECC publish the latest phase of the 2050 Pathways Analysis. It focused on a revised 2050 Calculator web tool which now includes maps, energy flow diagrams and summaries of each sector and a “My2050 simulation” which is a web tool designed to engage the public on making choices to reduce emissions. On the same day ENA ask the DECC Secretary about aspects of the pathways analysis.  

The clear message from Mr Huhne was despite all the analysis and all the modelling the future is not ours to see. He said the best forecaster can only predict a year ahead let alone 40 years. However amidst this uncertainty are some interesting messages coming from the top floor ministerial offices of DECC.  

In a speech deep in Whitehall under the watchful eye of a portrait of George Stephenson, Mr Huhne said the future was about a smarter grid and yes there was a role for gas, even perhaps still for heating in our homes. Energy Minister Charles Hendry had said at the Electricity Market Reform (EMR) Launch back in December that he doubted it would have this role in the future in response to an ENA question.  

Last week Mr Huhne said he wanted to see biogas in boilers. We picked up on this and asked him whether this meant he thought gas had a role in heating the homes of the future? He said it couldn’t be ruled out. Thinking about ENA’s Redpoint Report pointing to gas as having a low cost role in securing our energy future Mr Huhne said that he wanted to find a good deal for consumers but it had to be long term. He was well aware that shale gas already means falling gas prices (quoting the US price as halving recently). This could change things he said. On biogas he said the Renewable Heat Incentive was imminent.  He also said that there was a strong role for CCS gas and this was underlined by the fact that DECC had negotiated the largest concession out of the Treasury in the CSR over the £1b subsidy (brokered by DECC Minister Lord Marland the Bulletin understands).  

Mr Huhne is a trained economist and a successful businessman. He understands and is guided by the power of figures. The Pathways analysis still does not include any further details of costing. The Bulletin understands that DECC will publish further details in mid –summer as this is still being worked on by Markel modelling. This will be definitive for the Secretary of State. He is evidenced based in his approach. Speaking the other day Meg Hillier, Shadow DECC Secretary said that the White Paper due out in May following the EMR consultation had been moved to nearer the autumn she had been told by Mr Huhne. The Bulletin understands that this could be the colder and darker end of autumn. The delay is wise. As Mr Huhne said last week it is better to take the right decision slowly than the wrong decision quickly.  

______________________________________________________________  

E.ON sells Central Networks to PPL Corporation  

Last week E.ON agreed to sell its UK electricity power distribution business, Central Networks, to PPL Corporation, Allentown, Pennsylvania (PPL) for £4b. E.ON said that in PPL, it has found “an experienced and professional partner which is committed to the long-term future of Central Networks”. E.ON AG’s supervisory board approved the deal which is expected to close in early April.  

The purchase price of £4b for 100% of the enterprise value includes an assumption of £500m of existing debt. Central Networks is the UK’s second largest electricity distributor and operates the regional grid that covers the UK’s Midlands. Through its network of 133,000 km of overhead and underground cables, the business delivers power to over five million customers.  

______________________________________________________________  

Smarter grid research centre launched in Scotland  

On 25th February a new research centre that will accelerate the adoption of new, 'smart' technologies, from advanced power grids to electric cars and household appliances, was opened in Scotland.  

The £12.5 million Power Network Demonstration Centre - the first of its kind in Europe - is being created by the University of Strathclyde and leading energy companies including ScottishPower and Scottish and Southern Energy, with support from Scottish Enterprise and the Scottish Funding Council.  

The Centre will play a key role in increasing the UK electricity grid's efficiency and reliability, as well as testing the next generation of smart electrical technologies. This will support the integration of new renewable energy sources, electric vehicles and smart household appliances with the grid, such that emissions and cost can be minimised.  

Jim Sutherland, Network Development Director at ScottishPower, said "the Demonstration Centre is an innovative concept that will produce some of the most advanced carbon reducing technologies anywhere in the world".  

Alan Broadbent, Head of Engineering at Scottish and Southern Energy Power Distribution, said "the opening of this new centre represents a huge opportunity for Scotland and the UK to speed up the decarbonisation of the grid.”   ______________________________________________________________  

SHE 2011

With unprecedented challenges facing the energy industry, the advent of a new Government and the launch of Powering Improvement, SHE2011 is set to be the best ever.  

Among the highlights are addresses from Paul Noon, General Secretary for Prospect, Dame Carol Black, author of the Working for a healthier tomorrow report and Lawrence Waterman, Head of Health and Safety for the Olympic Delivery Authority.  

We will also hear from our Powering Improvement champions for 2011, John Crackett of Central Networks and Jane Willis of the HSE.  

The Energy Industry Safety, Health & Environment Conference is unique in the way it brings together all stakeholders, from the companies through Government and its agencies to the trades unions, to focus on safety, health and environment issues.  

This is the 22nd such conference and it has established itself as ‘the event’ to attend for all those involved in safety, health and environment issues across the energy sector and beyond.  

The Conference takes place on the 13th,14th and 15th of April 2011 at the famous Belfry Hotel near Birmingham, starting with a pre-conference reception being held there on the night of the 13th April and formal conference dinner on the night of the 14th. The conference is being hosted by E.ON UK.  

As with last year delegate fees include accommodation for both nights of the conference (13th and 14th). Special rates are offered to ENA, AEP, ERA, GISG and Gas Forum members.  

For more details and to make your booking click here. 

______________________________________________________________  

Brussels Update  

Brussels breakfast meeting on Smart Regulation for Smart Grids  

At a smart grids breakfast meeting in Brussels, Andy Phelps, ENA Director of Regulation, presented the key recommendations from EURELECTRIC’s new report “Regulation for Smart Grids”.  

The main points made in the new report were the need to:  

  • Reward and Incentivise Capital Expenditures (CAPEX) in Smart Grids  

  • Improve the evaluation of Operational Expenditures (OPEX)  

  • Incentivise innovation and R&D funding  

  • Clarify roles and responsibilities  

  • Safeguard regulatory stability  

The central message was that, as monopolies, networks need an appropriate regulatory framework with the right risk reward balance. This framework needs to be adaptable but should be based on certain key principles in order to reassure investors. ‘Business as usual’ and R, D&D costs must be differentiated from each other. Andy suggested that a regulatory road map could be a useful tool for regulatory stability.  

Eurelectric are pressing the Commission to keep up the momentum on the development and implementation of smart grids.  

Commission – smart grids communication expected 14 April  

Manuel Sanchez-Jimenez spoke on behalf of the European Commission. The Commission wants smart grids to be a reality by 2020/2030.  

It was generally accepted that smart grids are not a new technology but rather an evolution. Important to note that work on smart grids is not starting from zero, €5.5bn has already been spent in developing more intelligent networks in the EU. The Commission is now looking at what it can be done to accelerate smart grid development, following recommendations from the EU Smart Grids Task Force.  

Initial steps already taken include a new EU mandate for smart meters, with European standards bodies developing a new common standard to be in place by the end of 2012. New data protection legislation will be in place sooner, by this summer hopefully.  

The Commission is now focused on defining the main roles and responsibilities of the key actors. They also believe that more work is needed on data security. In terms of financing, the right regulatory incentives will be essential. Accelerated permitting procedures for new infrastructure also form part of the Commission’s thinking, in line with ideas expressed in the Infrastructure Blueprint. All of these ideas are likely to be included in the new Communication on smart grids expected next month.  

This Communication, to be adopted on 14 April, will be launched during the Sustainable Energy Week in Brussels, 11- 15 April. The new Strategic Energy Policy Plan and ICT Policy for Smart Grids are also expected to be launched at the same time. A new Smart Grids Directive is expected to follow on later this year.  

Networks meeting with Commissioner Oettinger  

ENA was part of a European networks delegation which recently met the Energy Commissioner and his team at their Berlaymont base in Brussels.  

He was supportive and appreciative of the role the networks play in terms of delivering on the 2020 and 2050 low carbon targets. The new smart grids Communication expected in April was discussed. Also the Infrastructure Blueprint and next steps in terms of new legislative proposals for accelerating the planning process at EU level, whilst acknowledging the lead role played by national and regional governments, and the more effective leveraging of private financing for projects of European interest by EU institutions, whilst again accepting that the market will deliver the bulk of infrastructure financing across Europe.     

The Commissioner’s main focus was on the new Energy Efficiency Plan, expected to be published this week. As an experienced and pragmatic politician, he has recognised the strength of opposition from a number of Member States to the concept of binding targets. It seems clear that some more time will be allowed to see if the EU can get back on track to realistically meeting the current 20% target, which is however non binding, before any mandatory targets at national level are imposed.  

______________________________________________________________  

'The Bulletin' is ENA's free fortnightly round-up of key issues affecting the sector. Visit http://www.energynetworks.org/bulletin for the latest edition or sign up at http://www.sign-up.to/signup.php?fid=602&pid=4068 to become a subscriber.  

For more information, contact Tony Glover on 020 7706 5122 or email tony.glover@energynetworks.org.  

Copyright © Energy Networks Association 2010. Copying, duplicating or reproducing this or any other issue of 'The Bulletin' without written consent will constitute an infringement of this work under the Copyright, Designs & Patents Act 1988. All rights reserved.   Any opinions expressed in the Bulletin or its attachments do not necessarily reflect the opinion of any members of ENA.