Barriers to effective retail competition need to be removed

Retail price caps continue to make the news, as “dealing” with rising energy prices is seen as a popular move in the run up to the General Election. As has now been argued many times, including in this blog, price caps are unlikely to be beneficial, with many unintended adverse consequences likely. The question is,…

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Can energy price caps ever work?

Last week the Conservative Party has announced a manifesto commitment to an energy price cap, despite warnings from across the industry, including in this blog, that the idea is unlikely to work, and may have significant unintended adverse consequences. In his recent address to Centrica shareholders, Iain Conn made reference to failed caps in New…

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New York REV: a case study in whole system re-design

I have highlighted in recent posts some areas of regulatory reform that are needed in order to deliver the energy transition at the lowest possible cost. This is a complex challenge, so it is interesting to consider the work going on in the State of New York, where there a serious attempt to fully re-design…

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Disruptive innovations in the energy sector

13 April 1892 saw the birth of Robert Watson-Watt, the inventor of radar, and descendant of Scottish inventor James Watt after whom the unit of power was named. Also on this day in 1960 the first satellite navigation system was launched and a decade later in 1970, the oxygen tanks on Apollo 13 exploded leading…

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Finding the right business model for electricity storage

The question of how electricity storage should be treated by regulators is once again in the news, with National Grid and UK Power Networks making submissions to the UK Government setting out their reasons for wanting to be able to own and operate electricity storage assets themselves. They argue that as storage can be used as an alternative…

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Why energy price caps are not the way forward

Once again we hear in the news the ominous threats of energy price caps in response to retailers raising their prices, and while the desire of politicians to respond to consumer anger is understandable, this is a temptation they need to resist. The dangerous logic of price caps assumes that prices are inflated in order…

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Energy security: can you ever have too much?

I recently wrote about the calls from the House of Lords for energy security to be prioritised over the other elements of the trilemma. With the end of Winter 16 almost upon us, and with it the end of the Supplementary Balancing Reserve (“SBR”), it’s reasonable to ask what is level of supply margin is…

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Embedded benefits: changes coming from all directions

The much anticipated changes to the embedded benefits regime came a step closer last week with Ofgem’s announcement that it is minded to implement a proposed change to the CUSC that would limit the demand residual component of TNUoS payments to embedded generators to around £2 /kW, down from current levels of £45 /kW. A…

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