The Informer

This week's headlines: the Chancellor has been criticised for a lack of action on climate change in his spending review; more industry co-ordination has been called for to help flexibility achieve its full potential; and Engie are fined for manipulating wholesale gas prices.

  • Spending review criticised over lack of climate action

    Senior figures from the power industry, as well as environmental groups, have criticised Chancellor of the Exchequer, Sajid Javid for a lack of action in his maiden spending review to tackle climate change.

    Javid admitted the “challenge of decarbonisation is real” and that details of the UK Government’s plans to tackle the issue would be laid out in its infrastructure strategy later this year.

    Ahead of the Chancellor’s statement, campaigners had called for the government’s spending on tackling climate change to be doubled.

    Charlotte Morton, Chief Executive of the Anaerobic Digestion & Biogas Association, said: “Despite the current political uncertainty, our climate emergency is not going away and will not wait for Brexit to be resolved.”

    Sir John Armitt, Chair of the National Infrastructure Commission, added: “The Chancellor is right to recognise the UK must up its game on infrastructure, but any revolutionary plans for digital connectivity, improvements to failing urban transport networks and expanding clean energy must be translated into effective actions.”

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  • Ofgem urges industry co-ordination on flexibility

    Companies need to stop duplicating their efforts and work together if they are to harness the benefits of flexibility, according to Ofgem’s latest Future Insights study.

    The energy regulator has warned against a single party – such as a distribution network operator – being given a monopoly over flexibility procurement because such a move could pose a risk to consumers.

    Ofgem said there was a need for more flexible generation but pointed out that a “significant proportion” of what will be necessary is already connected to the grid.

    Instead, the watchdog wants to see better use of flexibility platforms to harness the benefits of such flexible generation.

    New standards are also needed for data and processes, the paper added.

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  • Scotland launches £3bn green project portfolio

    Scottish First Minister Nicola Sturgeon has laid out plans for a ‘New Green Deal’ for Scotland with a £3 billion package of investments to attract green finance.

    The spending plans will cover heat, waste, power generation and property. Sturgeon said: “We are without doubt one of the best countries in the world to invest in low carbon or net zero projects – by promoting the Green Investment Portfolio, we will ensure that fact is known to investors around the world.”

    Other measures in Sturgeon’s programme for government included trialling low- and zero-emission aeroplanes between airports in the Highlands and islands in 2021, a new target to decarbonise Scotland’s railways by 2035 and a further £17 million in low-carbon transport loans to help businesses buy ultra-low emission vehicles.

    Richard Dixon, Director of environmental group Friends of the Earth Scotland, said: “The obvious contradiction at the heart of this programme is its commitment to some new measures in transport, heating and agriculture while continuing to back the offshore oil and gas industry to keep on drilling and destroying our climate.”

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  • Bioenergy needs to double energy mix share to safeguard security

    A new report from the Renewable Energy Association (REA) has called for 16% of the UK’s primary energy supply to come from bioenergy by 2032, in order to sustain energy security.

    The extra capacity – just over double the current 7.4% share – is needed to fill the gap when nuclear power stations are decommissioned, and meet rising demand when the heat and transport sectors are decarbonised, the paper said.

    Recommendations in the report include: an obligation on gas suppliers to blend in a minimum amount of renewable gas following commitments made in the UK Government’s spring statement; renewing support once the Renewable Heat Incentive comes to an end; and an auction mechanism to kick-start the market for capturing and storing carbon.

    Nina Skorupska, Chief Executive at the REA, said: “Bioenergy is the backbone of the renewables revolution providing all-important dispatchable power and the most advanced solution to meeting the demands of heat and transport.”

    The report is the final publication in a series of three released as part of the REA’s bioenergy strategy.

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  • £2.1m fine for energy price manipulation

    Ofgem has fined Engie Global Markets (EGM) a total of £2.1million for “spoofing” the wholesale gas market to increase profits.

    Spoofing involves manipulating prices by placing bids or offers to trade with no intention of executing them in order to buy or sell at a higher or lower price and increase profits.

    A trader working in the name of and acting on behalf of EGM manipulated the market between June and August 2016.

    Chief Executive Dermot Nolan said: “Ofgem’s enforcement action sends a strong signal to all energy market participants that we have the powers to tackle market manipulation wherever we find it – and are ready to use them.”

    EGM agreed to settle the investigation early and has taken what Ofgem called “proactive measures” to prevent such market abuse from happening again.

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