Sing it out for decarbonising heat and transport

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Scanned whilst entertaining myself with quarantine karaoke… 

It was partway through a private parody rendition of Eminem’s “Without Me” that I realised there’s a small chance I, with the rest of the nation, might be descending into a state of lockdown lunacy.

“Private” of course being me and my bathroom mirror.

This is indication of idiocy not because my audience didn’t appreciate the material – she was dancing as much as I was – but because the subject of my parody is about as un-street as they come.

So… Guess who’s back? The MP for Doncaster North.

Ed Miliband is back on the frontbenches as Shadow Minister for Energy. He’s held the brief before, which always helps. His track record suggests he’s not been a supporter of recent change in the industry – he voted against the removal of Levy Exemption certificates (thanks to which we now pay CCL on renewable power), he voted against the cuts in feed-in tariff and he voted against the Electricity Market Reform.

The EMR introduced new ways of funding low carbon generation and capacity. Five years in, this is reportedly going well. At least, that’s the conclusions from Ofgem’s Annual Report on the Operation of the Capacity Market.

The CM is proving effective at driving low cost development of reliable capacity – the last auction in 2018 cleared at a price of £0.77/kW/year. This is the lowest price for capacity ever recorded.

The scheme has been less effective however at encouraging diversity in the capacity mix, with 56% of contracts awarded in that auction going to combined cycle gas turbines.

Ofgem has recommended that National Grid ESO are no longer incentivised to promote Demand Side Response because they see no correlation between the Delivery Body’s efforts to improve DSR participation in the CM and participation itself.

DSR accounted for around 5% of the procured capacity in the last auction.

Demand Management is however incredibly important, especially as we continue to electrify our heat and transport sectors. But, as end-users, we need to know it makes financial sense as well as providing grid-level environmental benefits.

And we have good news: stacking revenues from multiple sources just became one step easier.

The Energy Networks Association has announced a standardised contract for the procurement of flexibility services by all Great Britain’s Distribution Network Operators (DNOs). This standard process will now make it easier for companies with sites in multiple regions – and their aggregators or consultants – to successfully complete and secure applications to provide demand flexibility.

Flexibility is not just about buildings though.

BEIS has an open call for funding to trial smart-meter enabled vehicle to grid technologies and, as part of the Mayor of London’s Electric Vehicle Infrastructure Taskforce, the manufacturing body BEAMA has just published a best practise guide for anyone looking to install EV infrastructure.

With a strong focus on futureproofing to ensure the chargepoints remain useful through regulatory and technological change, this sets out the key principles to consider to maximise the value of we’re procuring and avoid ending up with stranded assets.

It might be useful to not just read about it but to really grill the experts on this “future ready” idea.

What, exactly should we be thinking about as we look to reduce both carbon AND lifecycle cost?

Well this looks like a job for me, cos we need a little controversy.

So, we’ve invited the report’s author in for a web-enabled chat on Wednesday 6th May.

Jeremy Yapp is BEAMA’s Head of Flexible Energy Systems and one of the best people I know for making the smart agenda understandable to you and me. If EVs are on your radar, please do join us.

Decarbonising transport is one major challenge. The other is heat.

As we reported last week, National Grid sees increased electrical heat demand as their biggest challenge to meeting Net Zero. With electric heat so challenging, we are expecting to hear a lot about heat networks in the years to come.

Heat Networks are, at the moment, unregulated. BEIS thinks it’s about time that changed.

The Department have an open consultation on how to both protect consumers and support the market for heat network delivery. ICON will be responding to this consultation so do get in touch if you want to be involved.

For industry, any investment in heat decarbonisation might start with a look at heat recovery. With a funding pot of £18 million, BEIS are keen to support you.

The Heat Recovery Support Programme is open now. You can access this funding at two points in the project – Phase 2 covers project delivery, from detailed design to seasonal commission but Phase 1 covers concept and feasibility. We can help with applications, which must be submitted by my brother’s birthday – 31st July.

It’s not often funding covers feasibility so we strongly advise manufacturers and data centre owners to take advantage of this.

Reusing heat which would otherwise have been vented to atmosphere or washed down the drain has got to worth a look.

Talking of drains, Ofwat are still leading the way with their Covid-19 support plans as they have updated several industry Codes to protect non-household customers at this time. We mentioned last week that Retailers can mark sites as temporarily vacant to avoid accruing charges during lockdown – except certain wholesaler charges.

The latest guidance makes it very clear that the Retailer needs proof to do this.

If you have closed a site and want to benefit from the water industry’s move to protect customers from racking up massive bills, you must inform your water retailer that the site is vacant.

Of course, when the lockdown is lifted, if the meter has ticked round during that time, you will be billed on the latest readings. On the positive side, if you’ve got a leak, at least you’ll know about it!

Ofgem haven’t prescribed how suppliers should act at this time but do expect them to uphold standards of customer protection. The regulator has however listed out what they deem High or Lower Priority works for the DNOs. Unsurprisingly, connection requests and metering issues are not a high priority right now – unless they support a major resilience project.

Resilience is a good watch-word. Not just for the energy networks but for our personal outlook.

We will emerge from this lockdown into an altered world. A world to which we must adapt rapidly.

For anyone in energy management or sustainable procurement, change management is an old friend – or foe! – but a few pointers always helps.

Our next webinar is all about Change.

How do we keep Sustainability (and our jobs!) as a business priority, even amongst those who aren’t keen. This will be led by Sarah Divall of Hubbub who has years of change management experience and I’m really looking forward to hearing your questions for her.

Until then, please stay safe.

Stay sane.

Stay stoic.

And keep in touch if you need a chat – sustainability includes social impacts as well, and the most important thing to us at ICON is our community.

Thinking of you,
George

 

For more information, or to download this week’s full report, please log onto the ICON app.