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Tag Archives: Energy Security
December 2014: The House of Lords Science Science & Technology Committee have been conducting evidence sessions earlier this month for their current inquiry into the Resilience of electricity infrastructure.
Interesting to note that included in the written evidence provided to the Committee is a submission from the City of London Corporation (page 28 onwards). The Corporation’s main point is the “need for greater regulatory flexibility and more targeted investment and calls for better planning of the delivery of capacity in the system.”
The Corporation’s memorandum continues:
- It is clear that its [UKPN’s] network in London does not have available spare capacity to cope with future demand. This poses risks to future development and refurbishment cycles because developers and property owners are unable to be sure of the availability of electricity capacity. Further uncertainty results from the fact that it can take up to 3 years for substations to be reinforced and installation works completed so as to have sufficient capacity to supply a new building.
- The Corporation suggests that: “Given Ofgem’s existing regime does not incentivise investment ahead of need, new connections generally occur on an ad hoc basis, responding to immediate demand. The difficulty of creating such new connections at the last minute is hampered by the physical characteristics of the City (such as utilities congestion under the highway.”
- The Corporation is also critical of Ofgem’s determination of UK Power Network’s (UKPN) submission to the next regulatory framework period for investment (RIIO-ED1) – as summarised by Ofgem in the following press release. The Corporation states “Ofgem[‘s] proposed 12% reduction in the UKPN’s overall spending …would mean a loss of money available for investment in central London of around £200 million. This is highly likely to have a significant impact on UKPN’s ability to undertake a suitable level of network asset replacement work in the period 2015-2023. Cuts in investment are likely to lead to more widespread and frequent network outages due to the age of network assets.” Ofgem has in fact put pressure on all distribution network operator’s (DNOs) business plan submissions, and this drive down in UKPN’s cost proposals would not necessarily mean a direct reduction in investment in central London: it would depend on where UKPN apply savings to.
- The submission continues to highlight what it believes are further critical investment proposals within its territory to electricity infrastructure investment, calling on Ofgem to “reinstate this funding element in its final determination [to UKPN] in December 2014.”
The memorandum references research undertaken by the British Council for Offices which outlines that the forthcoming closure of the UK’s legacy generation plant and lack of available new sources of generation has increased the likelihood of blackouts from 1 in 3,307 years in 2012 to 1 in 12 years in 2015.
The submission makes a number of interesting points including “…the starting point for the verification of any case for investment ahead of need will be a clear overview of available DNO substation capacity in areas of high development growth. Regrettably this data is currently unavailable Ofgem and the Government should ensure that DNOs make this information publically available. It would be important to consider this data alongside information from developers, market details and Local Authority information.”
The Corporation of London’s evidence have been advised through research they have commissioned including – Delivering Power:The Future of Electricity Regulation in London’s Central Business District – and the Future of London’s Power supply. The Mayor has also written to the Secretary of State raising similar concerns over London’s electricity infrastructure.
July 2014: News that Barking Power Station’s owners have begun “negotiations over the facility’s closure due to poor market conditions…The proposal to close the power station and embark on these consultations is taken in the context of the current adverse market conditions for gas-fired power generation,” the facility’s owner Barking Power Ltd said in a statement on Tuesday. If implemented, the full closure of the station is expected to be completed within two years”.
Despite concerns over falling levels of electricity system supply margins (see latest Ofgem Electricity Capacity Assessment report here), due in part to the closure of coal-fired power stations, the news report states that “because gas prices have been high relative to wholesale electricity, which power generators sell into the grid, aging power stations such as Barking with relatively low efficiency grades struggle to make a profit.” An earlier news report highlighted how part of the plant had been previously mothballed in 2013.
Barking Power Station was completed in 1995 and has a capacity of 1,000 megawatt (MW), enough to supply over half a million homes with electricity. Further information on the power plant can be read in its Wikipedia entry, a profile by the plant’s operator, and – going back a bit further – details of the original coal power station that was opened on the site in 1925!
June 2014: “This report, commissioned by the City of London and authored by Stephen Jones Associates and South East Economics sets out the issues that London’s economy will face in meeting future rising power demands in the form of a road map. The road map is supported by materials set out in the report and provides a summary of the wider policy issues, London-specific issues and a timeline of key events.”
Various points made in the report include:
- It is anticipated that over the next thirty years there will be large increases in electricity demand in London. In the context of rising electricity prices, this may significantly impact end user bills.
- This report has been commissioned in support of the Greater London Authority (GLA) Long Term Infrastructure Investment Plan which will set out London’s strategic infrastructure requirements to 2050 across the main aspects of infrastructure including energy.
- Page 20 onwards of the report provides a useful summary of UKPN’s projections for London electricity demand growth over the period to 2030
December 2013: The Mayor announced last week that he has commissioned work to “create the capital’s first Long Term Infrastructure Investment Plan”, which will make a high level assessment of the full range of infrastructure delivery in the city, looking at how it is managed currently and what could be improved. The scope of the plan will cover public transport, roads, energy, water, sewerage, waste, broadband and green infrastructure
As part of this work, a Call for Evidence has been issued setting out five ‘core questions’ (see link for details), open to all to respond to, with a deadline for submissions of 24 January 2014.
The Mayor’s Infrastructure Group has been leading on the development of the plan, and their December 2013 meeting set out a working paper with some further detail on what the plan will consider, including the consideration of climate change and future energy demands on London. Included in this paper are a number of important proposals including mention of developing a London-wide Energy Master Plan and a GLA-led body delivering Green Infrastructure:
- “To address these issues, and address the implications of climate change, a range of recommendations are being proposed. All need further explorations in terms of feasibility and value for money, but provide a starting point for determining how London may need to respond to its infrastructure needs. The list of draft proposals to date is attached at Annex A; they include: Develop an Energy Master Plan for London, based on favoured approach of either continued nationally led centralised provision, or a decentralised model based on local energy production from a range of low and zero carbon energy sources. (Favoured approach to be set out in the Infrastructure Investment Plan for London).
- Create a GLA-led delivery body to deliver green infrastructure projects to reduce the amount of rainwater entering the drainage system. Potentially to be funded from the water companies and developers.”
Potential concerns over future stresses to London’s electricity system led to the Mayor writing recently to Ed Davey, Secretary of State for Energy, and the formation of the Mayor’s High Level Electricity Working Group.
A strategic outlook on London’s future energy needs (both power and heat) is an absolute requirement of any future London infrastructure plan: much of London’s electricity distribution assets are in need of replacement, London’s population is set to grow significantly to 2020 and beyond, and the the Mayor’s own target for London to source 25% of its energy needs from decentralised energy will require a significant shift to the introduction of low carbon, localised generation capacity being introduced onto London’s electricity network.
The Long Term Infrastructure Investment Plan for London will be produced in two stages – an interim report (inviting comment) in February 2014 and a final report in Summer 2014.
October 2013: The issue of London’s electricity infrastructure is being raised in several quarters now, most recently by the Mayor in a letter to Secretary of State for Energy , Ed Davey, and through the Mayor’s High Level Electricity Working Group. More recently the GLA London Infrastructure Group has looked at future constraints on London’s electricity network, which has led to the recent commissioning of a piece of research work looking at barriers to connection to the electricity distribution network in the capital.
“the UK’s poor ranking on electricity connections (only 62nd out of 185 economies) in the World Bank’s ‘Ease of Doing Business’ survey (London example was used for UK assessment), the Prime Minister’s Office and the Department for Business Innovation and Skills (BIS) are now investigating the issue and officers as well as Matthew Pencharz are in touch with relevant officials. ”
In relation to the recently commissioned research the paper states this “is expected to conclude in January/February 2014, and on its basis further discussions with the Government and other key players about improving infrastructure funding arrangements will be initiated.”
September 2013: This month the Mayor has been asked questions in relation to:
How the Mayor’s programmes will respond to the forthcoming IPCC’s (Intergovernmental Panel on Climate Change) 5th Assessment Report; the Mayor’s “climate sceptic views“; London’s growing energy demand; £145k spend on climate change adaptation; the amount of energy generated from waste incineration; the number of GLA officers working on energy efficiency retrofit; the amount of ECO funding that could be directed to London; the operation of the RE:FIT schools energy efficiency programme in Harrow; the RE:FIT schools programme in Brent; Government’s proposed changes to building regulations and its potential impact on London Plan energy requirements; the Mayor’s response to DECC’s Community Energy – Call for Evidence; the Mayor’s support for community energy schemes in London – such as Brixton Energy; publication of the latest London Energy and Greenhouse Gas Inventory (LEGGI); the cost of producing ‘Using Local Powers to Maximise Energy Efficiency Retrofit – How to’ materials for London’? (report here); the terms of loans provided by the London Energy Efficiency Fund (LEEF); extending LEEF loans to the private sector; details of the LEEF Advisory Committee; consultancy companies working on LEEF; the amount spent by LEEF; the number of loans given out by LEEF; rollover energy contracts for SMEs; Londoners energy bills; the amount of renewable electricity provided by Source London electric vehicle charging points; funds previously spent on adding energy efficiency measures to Metropolitan Police buildings currently for sale; developing a Fuel Poverty Action Plan for London; the supply of electricity to London’s electric vehicle charging points; the supply of electricity to London Underground; London Green Deal targets; a London Green Roofs map; the Mayor’s Green Deal assessment on his home; stimulating Green Deal finance packages; spend of the Green Bus Fund; funding received from the Green Bus Fund; identifying brownfield land in London suitable for sustainable energy projects; CO2 savings achieved by the Mayor’s climate change programmes; potential for the London Pension Fund Authority to invest in low carbon energy projects; when the next update to the Mayor’s Climate Change Adaptation Strategy is to be published; how climate change will affect London’s summer temperatures; new anaerobic digestion plant in Surrey; the level of waste being directed to the Beddington incinerator; the London Plan’s policies on incineration; the Mayor’s approval of the Beddington incinerator; if the Mayor had pressed for the Beddington project to develop as a anaerobic digestion plant; if the Beddington incinerator can operate in combined heat and power (CHP) mode; heat network around the Beddington incinerator; the growth of waste incineration in London to 2016; the role for future incineration in London; local planning controls and fracking; the fracking potential in London; details of the new RE:NEW domestic energy efficiency programme; targets for the new RE:NEW programme; the choice of the Capita Group to manage the new RE:NEW programme; GLA buildings that have been treated by the RE:FIT programme; whether the Mayor’s Environment advisor had visited the Kings Cross CHP and district heating scheme.
Previous months questions to the Mayor can be found here.
15 September 2013: The Mayor has decided to set forth his views on UK energy policy in the national press once again. After writing to The Times back in July (see below), Boris has now penned a piece for The Sun (behind paywall…but fortunately reported elsewhere), where he states that: “the country needs to ‘grow some collective cojones and launch the nuclear energy programme that this country has too long delayed… Next, we must stop pussy-footing around, and get fracking. Even if we have 100s of fracking pads, they are nothing like as ugly as windmills, and they can be dismantled as soon as the gas is extracted.”
The Mayor continues in a similar vein in the article (also reported here ‘Boris on our ‘pathetic apology’ for an energy policy‘) railing against wind turbines – echoing views from a radio interview he undertook on LBC earlier this year (Wind farms couldn’t pull the skin off a rice pudding, says Boris Johnson).
Boris has previously used his weekly Daily Telegraph column to champion gas fracking (Ignore the doom merchants, Britain should get fracking) and much of the commentary for The Sun article was previously set out in a letter the Mayor sent to the The Times a few months ago:
” Sir, Many people have not yet woken up to the reality that the population of London is now growing faster than any city in Europe. As I make clear in our 2020 Vision, this demographic explosion is placing huge demands on our infrastructure — including power generation. It is a tragic comment on Labour’s failure to plan ahead that in only two years our electricity capacity headroom (the difference between demand and supply) will be down to 2 per cent. We will have to ask some of our more energy-intensive industries not to operate at peak times, the kind of policy we last saw in the 1970s. It is time for maximum boldness in energy supply. I fully support the Government’s drive for nuclear power, and if reserves of shale can be exploited in London we should leave no stone unturned, or unfracked, in the cause of keeping the lights on.
Boris Johnson Mayor of London” July 2 2013
That letter was a response to energy regulator Ofgem’s capacity report which set out that “electricity supplies are set to tighten faster than previously expected in the middle of this decade”. Energy security appears to have become a greater concern to the Mayor since raised by London businesses, and has led to the establishment of a London ‘High Level Electricity Working Group‘ coordinated by the GLA.
Whilst security of energy supply issues are a real concern, the Mayor’s choice of solutions are of no real help at all. Nuclear negotiations have stalled over the past year, and even if agreement were reached today, the first power produced by a new nuclear plant is the best part of a decade away – well after the 2015 capacity concerns. Discussions around shale gas have become increasingly polarised: whatever the final outcome, it is unlikely that fracked gas will have any significant role to play in the nation’s energy mix for some time.
July 2013: This month the Mayor has been asked questions in relation to:
the Mayor and climate change denial; whether the Mayor will be publishing an update to his Climate Change Adaptation Strategy; if an audit of the London Energy Efficiency Fund (LEEF) will be undertaken; progress under LEEF; promotion of water efficiency measures; commissioning an energy security of supply study for London; the proposed Memorandum of Understanding between the Mayor and energy suppliers; Energy Performance Certificates (EPCs) and RE:NEW; confirmation of the single loan provided by LEEF; the Transport for London (TfL) energy strategy; TfL emissions action plan; clarification on the Mayor’s policy on waste incineration; fracking in London; the Mayor’s comments on climate prediction; differences between the Mayor’s comments on climate prediction and the London Climate Change Adaptation; the Mayor’s 2013/14 budget for climate adaptation; TfL climate risks action plan; the Mayor’s work with the insurance industry on building regulations; funding a health sector building to be climate resilient; climate risk information to Health & Well Being Boards; the Mayor’s commitment to look at overheating; work on risks related to flooding and critical infrastructure; flood risk data portal; surface water management plan for London; performance of the Green Deal in London; avoiding future electricity blackouts in London; weather data for London; work on the London Rivers Action Plan; developing community-led responses to heatwaves in London; buildings in London using cool-roof technology; studies with social housing groups on insulation and overheating; work with CIBSE on overheating in new developments; green roofs in London; helping offset the Urban Heat Island (UHI) effect in London; in light of the Mayor’s recent article – whether he will be abandoning Action 5.1 of his Climate Change Adaptation Strategy; an update on the London Drought Plan; the number of schools in London with rainwater harvesting systems; work on an intensive urban greening retrofitting pilot project to manage surface water flood risk; the work of the Drain London Forum; working with communities at flood risk; approved suppliers on the RE:FIT framework; the Citigen CHP scheme; how the Mayor will stop the Green Deal being a total disaster in London; Job losses in the insulation industry.
Previous months questions to the Mayor can be found here.
July 2013: A recent meeting of the London Infrastructure Group, part of the London Enterprise Panel (the local enterprise partnership for London) included a paper considering requirements for London’s growing electricity infrastructure.
The paper highlights that “UK Power Networks (UKPN) is London’s main Distribution Network Operator (DNO) for electricity serving all except the London boroughs of Hillingdon, Hounslow and Ealing. Scottish and Southern Energy serve these boroughs. As DNO UKPN’s responsibility extends from the Grid Supply Points where it takes electricity at high voltages from National Grid to the supply of London’s homes and businesses.”
UKPN is currently consulting on its 2015 – 2023 Business Plan which is to be submitted to Ofgem. Much of the detail around UKPN’s proposals in the Plan have been discussed in recent meetings of the Mayor’s High Level Electricity Working Group and an appendix paper to the London Infrastructure Group meeting considers some key elements of the Plan.
The papers report that the Mayor has raised concerns regarding future investment in London’s electricity distribution infrastructure and that UKPN latest proposals “represent a step backwards regarding the prospects of UKPN investing in advance of need. It gives rise to concern about whether UKPN has taken sufficiently full account of the needs of the City of London and other central London boroughs facing business and development growth. The reason for the backward step is mainly attributable to the intervention of Ofgem” (some of these concerns on future needs were recently raised by businesses in the recent West End Commission report).
Investment in major substations has been reduced from £170 million to £100 million compared to the original draft. UKPN now includes only four of the planned six (plus Earls Court1) major substations for central London on a funded basis (see Table 1 below for details). The origin of the change is principally Ofgem’s unwillingness to accept the remaining three substations as part of UKPN’s regulated asset base, since they would amount to investment by UKPN in advance of an actual connection being requested.
Interesting to note that other changes have been made to UKPN’s forecasts of sustainable energy investment in response to comments to the original consultation. These include changes to the assumptions regarding the uptake of electric vehicles and to the infrastructure investment for Feed–in–Tariff eligible generation.
18 June 2013: In November of last year the Mayor held an Electricity Summit at City Hall where a High Level Electricity Working Group was formed to “discuss the energy systems needed by London over the coming decades and the mechanisms by which the challenges can be met”. A background paper Delivering an Accessible and Competitive Electricity Network for London was presented as well as a presentation setting out the remit of the Working Group.
The papers for the 15 January meeting set some comprehensive information of key issues and detail the future priorities of the Group including:
- Identifying growth hotspots and areas of existing network stress that require strategic infrastructure investment
- the Potential of Decentralised Energy systems, district heating and demand side response measures to reduce electricity distribution infrastructure costs
- and Estimating costs of investments required and considering models for how they could be met/shared
The March 28 meeting set out a series of action points including that:
“The GLA and UKPN are establishing a sub- group with respective experts to discuss identified Decentralised Energy and demand side response issue identified at the January meeting. It meets for the first time on 3 May. As and when appropriate, the sub-group will report back to the High-level Working Group.”
The third of the Working Group meetings took place today: Sir Edward Lister is standing down from chairing, and the Mayor’s Environment and Political Advisor Matthew Pencharz will attend the Group meetings from today and chair from henceforth.
See here for the Mayor’s response on how renewable generators issues will be represented on the Group.
February 2013: This month the Mayor has been asked questions in relation to:
the Mayor’s position on nuclear and its role in securing London’s future energy supplies; the number of ‘low carbon generators’ currently helping power Transport for London’; the Mayor’s application to DECC’s Fuel Poverty and Green Deal Pioneer Places funds; European Investment Bank (EIB) funding for energy efficiency retrofits in housing; the amount of energy consumed by The Shard; the potential for the Green Deal in London; further funding for the Mayor’s RE:NEW home energy efficiency programme; promoting the Green Deal to Londoners over-65; publication of the latest TfL Environment report; GLA environment publications; hydrogen fuel cell electric vehicles; the number of fuel poverty households treated under RE:NEW; revised publication date of the RE:NEW evaluation report; the total number of homes treated under RE:NEW; funding and evaluation of the RE:CONNECT Low Carbon Zones programme; zero carbon developments on the Greenwich Penisula; the Mayor’s Low Carbon Prize; the RE:FIT Schools initiative; the number of jobs created under RE:FIT; progress on the LED traffic lights initiative.
Previous months questions to the Mayor can be found here.
November 2012: Further to his points made on fuel poverty and energy efficiency at last week’s Mayoral Question Time session, the Mayor also made some forthright statements on the current state of the UK’s energy policy (see page 44 of session transcript here ).
” I happen to think that the energy policy of this country is in chaos at the moment and we need to sort it out.
“…prices are going up but supply is increasingly insecure.”
“It is pretty obvious to everybody that the current strategy is incoherent.
“We seem to be going for more and more wind farms which are not actually doing the job.”
The Mayor stated that such concerns led to the convening of his first ‘electricity summit’ earlier this month and to the formation of a ‘High-level Working Group with the energy industry to examine infrastructure and investment issues in relation to London’s current and future energy needs. The group’s work will begin in January 2013.