Five things we learnt from Energy Spectrum | 663

At the start of April, National Grid Electricity System Operator (ESO) became a separate legal entity within the National Grid group, separate from the transmission business and with its own licence. In this week’s Energy Perspective, we discuss the move, which marks a milestone in the development of the ESO. We consider how the new incentive arrangements and Ofgem’s proposed treatment of the ESO in the upcoming price control provide direction to future activities for the ESO.

At a Science and Technology Committee evidence session last week, Energy and Clean Growth Minister Claire Perry said she was confident that the UK can achieve its fourth and fifth carbon budgets. We discuss Perry’s comments – and the other events of the session – in this week’s Policy section, noting that government confidence may well face a test this week when the Committee on Climate Change updates its advice on the scale of the net zero challenge.

Ofgem Chair Martin Cave delivered a keynote speech to the Citizens Advice Consumers at the Heart of the Future Energy System conference last week, focusing on the regulator’s future plans to help protect consumers. It was, we suggest in our Regulation section, a spirited defence from Ofgem’s new Chair of intervening in the market on distributional grounds, including the price cap and a more ambitious new vulnerability strategy.

In Industry Structure, we discuss a report produced for National Grid Ventures on the contribution of interconnectors to GB security of supply. It’s an interesting read on an interesting, if rather technical issue, and one that BEIS will wish to consider as part of the five-year EMR review presently underway. We suspect that the current rules in this area will be changed anyway, as the interconnector-led model is replaced.

In this week’s Nutwood, Cornwall Insight’s wholesale analyst Alex McGregor looks at prices for front-year EU Allowances (EUAs) in the European Emissions Trading Scheme (EU ETS) reaching 11-year highs. He explains that the start of the Market Stability Reserve (MSR) in January, a compliance deadline on 30 April and Brexit uncertainty have all played their part.

What is the Energy Spectrum service?

The Energy Spectrum service consists of two publications designed to keep you informed of key news from the energy market:

Daily Bulletin –  a concise daily summary of the key news from the last 24 hours in policy, industry and markets, and regulation
Energy Spectrum – our longer weekly publication provides a more detailed look at the events of the previous seven days. Energy Spectrum discusses the headline news and highlights key information within each brief. It also includes a markets page outlining headline trends in gas, electricity, and commodities
Sign up to a free trial

To subscribe or to request a free one-month trial of the service, email enquiries@cornwall-insight.com or call 01603 604 400.

Related thinking

Net zero corporates and ESG

Data critical for sustainable investments

On 24 June, attendees to our 'Financing net zero forum' tuned in to hear the expert panel discussions on the role of data in sustainable investment. Joining the meeting chairs, Cornwall Insight's Daniel Atzori and Emma Bill were our guest panellists from Mercatus and Victory Hill Capital Group LLP. For investors to make...

Heat networks

Reallocating electricity policy costs to incentivise low carbon heating technologies

Funding the cost of decarbonising the power system has mainly been through the consumers' electricity bills. In fact, in 2020-21 these costs amounted to a whopping £10bn. But is this method of raising revenue for decarbonisation still fit for purpose when faced with the need to decarbonise the nation's heat?...

Net zero corporates and ESG

Financing net zero panel advises policymakers for a long-term view of net zero to boost merchant renewable confidence

Last Thursday's 'Financing net zero forum' brought together 580 registered attendees across the renewables sector to listen to the expert panel discuss managing renewable merchant risk. Joining the chair of the meeting were experts from across the industry, with Shoosmiths sponsoring the afternoon discussions. Merchant renewables – the development of...

Net zero corporates and ESG

Get ready for climate risk reporting?

On 30 April we released the latest copy of our Energy net zero. The publication takes an in-depth look at the UK's transition to a low carbon economy. The below is an extract from our Energy Perspective on Task Force on Climate-related Financial Disclosure (TCFD). The article was originally published in the...

Low carbon generation

Data centres predicted to become prosumers of electricity

In combination with Cornwall Insight and Bit Power, Host in Ireland published its Biannual report of Ireland’s Data Hosting Industry. The report highlights the importance of sustainability in Ireland’s digital transformation. The report confirmed the number of operational data centres in Ireland increased by 25 per cent over the past...

Net zero corporates and ESG

Why energy system governance is not fit for purpose

In my recent blog, the Emperor’s new clothes I referenced a poll of our Financing Net Zero (FNZ) membership which revealed 75% support for an energy systems architect to ensure we manage the net zero transition. In the spirit of independent thinking that Cornwall Insight is known for, I respectfully disagreed and...

Energy storage and flexibility

How nuclear energy can help the UK reach its net zero goals

This article was originally written in Energy Spectrum on 21 March 2021. To find out more about a subscription to Energy Spectrum, please contact Nick on n.palmer@cornwall-insight.com. There are several challenges to reaching net zero, where its proponents believe nuclear could add value. Some of tomorrow’s main issues concern: How to provide low...

Low carbon generation

Up north and down south – trends for generator TNUoS charging

The topic of generator Transmission Network Use of System (TNUoS) is becoming a subject of increasing interest for stakeholders as regulation, policy, and the generation mix create potential volatility for future charging trends. The significant costs posed through TNUoS are an important consideration for generators, with high variability between regions...