Policy & regulation

Latest updates and analysis on how government and regulators' decisions will impact the sector 

Editor's picks

Alison Rose, the chief executive of Natwest, has been announced as the co-chair of the government’s Energy Efficiency Taskforce. The group, which will be jointly led by energy minister Lord Callanan, has been tasked with helping to reduce national energy consumption by 15% over the next seven years through insulation measures, boiler upgrades and other energy efficiency initiatives.
News
The investment climate for low carbon generation has “deteriorated significantly” in recent months, with the UK facing a potential £62 billion shortfall over the next decade, industry experts have warned. A report published by Energy UK states that without “rapid government intervention” the UK’s energy security and net zero targets will be undermined due to a lack of private sector investment, with “crippling consequences for the country”.
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Government is still pursuing hefty fines of up to £250 million as a deterrent to polluters, Therese Coffey confirmed. The Defra secretary demanded detailed plans on how water and sewerage companies intend to address each combined sewer overflow in their region as the sector works to minimise the risk of harm from discharges.
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Featured

The formation of a new energy security and net zero department has been welcomed by the utilities sector but will it actually prove to be an improvement on its sprawling and ineffective predecessor? David Blackman asks whether a standalone energy department risks being sidelined and if net zero really will be at the heart of its mandate.
Analysis
The government’s proposals to align the Capacity Market with the UK’s net zero target have been welcomed as a sensible pathway away from unabated gas generation. However, experts tell Utility Week this commitment must be matched by a concerted push to ramp up low-carbon flexibility.
Analysis
The controversy over forced installations of prepayment meters has sparked renewed questions over whether Ofgem is failing to enforce its own rules. Former senior partner Maxine Frerk details her concerns around whether the regulator is listening to the wrong voices.
Opinion

Latest in Policy & regulation

Ofwat has mooted a change to the performance incentives offered for customer service, after revealing that all water companies have so far failed to achieve higher outperformance payments during the current price review period.
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Ofgem chief Jonathan Brearley has admitted unrecoverable debts arising as a result of the ban on forced PPM installations could increase bills for paying customers. In a letter to energy retailers Brearley confirmed the ban on PPM installs by warrant extends to the remote switching of smart meters to prepay mode and that it would last until 31 March.
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Good Energy’s chief executive has criticised the current protections in place for vulnerable customers as "an unhelpful fudge", as he warned debt issues could "spiral out of control" if the use of prepayment meters (PPM) is discouraged. 
News
Faith in Ofwat’s independence has fallen over the past year among water sector investors, with fewer than half (48%) feeling the regulator is autonomous from government, compared to 55% in 2021. The regulator's annual poll of investors also highlighted concerns that shareholders' voices are not being heard.
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Ofgem is proceeding with proposals to introduce a new licence condition to prevent generators in the Balancing Mechanism from obtaining “excessive” profits by first signalling their intention to cease generating and then raising their prices to remain on. The move comes after parallel investigations by National Grid Electricity System Operator and Ofgem found instances of what the regulator described as “immoderate” behaviour over the winter of 2020/21,
News
With prepayment meters (PPMs) currently acting as a lightning rod for criticism of the energy retail sector, Utility Week speaks to the chief executive of the country’s only PPM specialist. Utilita’s Bill Bullen discusses politicians “jumping on the bandwagon”, Ofgem’s “unachievable and inconsistent” directions and “lazy, middle-class assumptions” around PPMs, as well as his challenge to other retailers to get out of the HQ and onto the high street.
Interviews
Consumers could be encouraged to take up low-carbon technologies such as electric vehicles and heat pumps through a student-loan type scheme, an industry expert has suggested. Jo Jo Hubbard, chief executive of Electron, told Utility Week more focus is needed on propositions that are "incentivising the right kind of behaviour".
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In our latest roundup of national press stories from the weekend, Gordon Brown calls for Jonathan Brearley's resignation over the prepayment meter scandal; John Armitt warns that renewables are insufficient to rely on for energy security; Jeremy Hunt rules out ongoing energy bills support; and Therese Coffey U-turns on £250 million pollution fines
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Jeremy Hunt has invited the government’s infrastructure advisors to review the National Policy Statements (NPSs) as ministers have revealed a five-month delay in the planning decision for a new 2.6GW offshore wind farm.
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Ofgem has accepted Grant Shapps' call to set up a channel for households to pass on their own feedback on how they are being treated by suppliers rather than relying on firms to share such information. The energy secretary's demand came as he issued another rebuke to energy retailers over concerns about the treatment of prepayment meter (PPM) customers. He said companies had complied with his request for more information on forced PPM installs but accused some of providing only “half the picture” on the steps they are taking to ensure the most vulnerable are protected.
News
Energy retailers have delivered more than £8.5 billion in estimated lifetime bill savings to fuel poor and vulnerable consumers through the ECO3 scheme, Ofgem figures have revealed. The regulator’s final determination report into the scheme, which ran from October 2018 to March 2022, shows that a total of more than 1 million measures were installed during this period. Only one supplier failed to fulfill its obligations, leaving a £35 million shortfall.
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It would not be “right” for an incoming Labour government to use scarce resources to nationalise existing energy companies, Ed Miliband has said. The shadow energy secretary said that with "all the things we have got to do with heat pumps, in industry and in home insulation.... we probably don't want to spend money buying up old generating assets”.
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