This is a record of Ofgem’s Sustainable Development Advisory Group meeting, held 25 June 2015.
1.1 See annex for attendance and apologies for the meeting.
2.1 The Chair welcomed SDAG members and highlighted that this would be the last SDAG meeting attended by Sarah Harrison, who would soon be leaving Ofgem to commence her role as Chief Executive for the Gambling Commission.
2.2 No comments were raised about the minutes of the previous meeting.
3.1 Natasha Smith (Consumers and Sustainability) gave an overview of the responses received to the NTBMs consultation.
3.2 A total of 59 responses were received from a variety of stakeholders. From preliminary analysis of these responses, key emerging themes are: local energy, the role of the demand side, innovation and consumer protection/risk in a changing energy system.
3.3 It was noted that a summary of the NTBM consultation responses is expected to be published later in the summer.
3.4 SDAG members displayed considerable interest in the analysis of the NTBM consultation responses. Specific comments / questions from members included:
3.5 The work on NTBMs also fed into the quicker and more efficient distribution connections consultation, which received 56 responses.
4.1 Sam Cope (Smarter Grids and Governance) provided an update on Ofgem’s Flexibility project; this project looks at demand side flexibility in both domestic and non-domestic markets.
4.2 There is an increasing volume of intermittent generation connected to the system and some generation is becoming more localised. New sources of flexibility (such as DSR, storage and distributed generation) are likely to be required to deal with the changing operation of the system.
4.3 The flexibility project has links with many ongoing projects within Ofgem, including NTBMs and Grid Connections.
4.4 Members discussed the issues highlighted in the presentation, including:
4.5 Next steps: Ofgem plans to publish a report later in the summer which will set out Ofgem’s role in facilitating the development of a flexible energy system. A flexibility workshop will also be held in September.
5.1 James Veaney (Smarter Grids and Governance) presented the main agenda item, on how energy networks can respond to the increasing deployment of Distributed Generation (DG).
5.2 This presentation discussed a range of issues which have arisen from the recent rapid deployment of DG on the electricity system. The mix of DG varies by region (eg high deployment of DG from solar PV in the south, higher deployment of DG from wind in the North). In some areas, the rapid growth in DG has caused network constraints which create barriers preventing new generators from connecting to the grid. This has been observed in a number of regions in the UK; one example discussed was the rapid increase of solar PV farms leading to constraints issues in the South-West of England.
5.3 The discussion outlined other impacts that have been observed, and may continue to occur with increasing deployment of DG. The growth of DG may be contributing to the occurrence of negative spot prices on wholesale power markets; this may impact the competitiveness of conventional generators and have security of supply implications. Additionally, the growth in DG may be disproportionately benefiting certain groups of consumers. Financially vulnerable consumers in many areas are less likely to experience the benefits which DG can bring.
5.4 Ofgem is considering a tactical response to these issues in the short-term, and also the longer-term strategic issues. The focus for this meeting was the latter.
5.5 Specific questions for discussion which were put to SDAG members included:
5.6 Members raised a number of points during the discussion of these questions, including:
6.1 The chair thanked Sarah Harrison for her contribution to Ofgem and SDAG over the years and wished her well on her future career, and thanked the SDAG members for their ongoing support.
7.1 The next meeting will be on 1 Oct 2015, from 10am to 12pm.
8.1 Those in attendance were:
Chair
David Gray (Gas and Electricity Markets Authority)
SD Advisory Group members / deputies
David Sigsworth (SEPA)
Doug Parr (Greenpeace)
Jenny Saunders (National Energy Action)
Juliet Davenport (Good Energy)
Dr Nina Skorupska (Renewable Energy Association)
Gordon Patterson (Scottish Government)
Matthew Quinn (Welsh Government)
David Capper (DECC)
Will Dawson (Forum for the Future)
Josh Barnett (Northern PowerGrid)
Ofgem Staff
Sarah Harrison
Philip Cullum
Stephen Bass
Natasha Smith
James Veaney
Katherine Thompson
8.2 Apologies:
Chris Stark (Scottish Government)
Giles Bristow (Forum for the Future)
Phil Jones (Northern PowerGrid)
John Feinnes (DECC)
Derek Likorish (Fuel Poverty Advisory Group)
Jeremy Nicholson (Energy Intensive Users Group)
Paul Ekins (UCL)
Nick Eyre (Oxford University)
Audrey Gallacher (Citizens Advice)