Ofgem's new Chief Executive Jonathan Brearly has released a 'Decarbonisation Action Plan' on his first day in office.
The plan sets out Ofgem's approach to meeting UK Government's commitment to 'net zero' by 2050 in an action plan which focuses on delivering nine key points. Among other points, the plan seeks to:
Build a system that supports the growth of renewables and ten million electric vehicles on our roads by 2030
Support development of an offshore grid to enable a four-fold increase in offshore wind generation by 2030
Set up an innovation fund focused on unlocking investment in innovative solutions to tackle climate change
The Action Plan sets out that to meet the challenge of net zero, we must now go further and faster, especially in decarbonising transport, heating and our industrial use of energy.
To bolster the UK’s vibrant offshore wind sector, Ofgem will explore with government and stakeholders how offshore networks could best enable the rapid growth of offshore wind power. A more coordinated approach will make it easier and cheaper for the electricity that offshore wind generates to reach consumers.
Here are Ofgem's nine commitments in full:
We will build adaptability into our price controls to ensure network companies invest efficiently and are able to adapt to changes in technology and infrastructure.
We will set up a regulatory fund to unlock investment in innovative solutions to tackle climate change.
We will explore, with government and industry, opportunities for greater coordination to enable rapid expansion of an offshore grid at lowest cost.
We will harness our existing knowledge and expertise to help government and the industry develop cost-effective and low risk options to decarbonise heating.
We are reviewing the way our energy systems are managed to ensure they are fit for a net-zero future.
We will create a more flexible electricity system to ensure that consumers will benefit from the lowest cost transition to a reliable net-zero system.
We will develop a regulatory strategy on electric vehicles to support roll out and maximise the benefits to consumers.
We will support innovation and experimentation, particularly in the retail market, to create low carbon products and services that will directly benefit consumers.
We will respond to the need to take big decisions facing a deeply uncertain future by becoming more adaptive in the way we work and in our regulatory approaches.
The full report can be read on Ofgem's website, here.
The report has been welcomed by numerous bodies, including the National Infrastructure Commission, releasing a statement saying:
“Regulators have a crucial role in working with government and suppliers to help consumers and businesses adapt to meet the demands of the future, and Ofgem’s decarbonisation action plan is a welcome next step forward in that goal.”